Midwest plant proposals face new hurdle — cheap alternatives

The combination of market factors means big bets on new gas-burning plants are a tougher sell to regulators than they were even a few years ago. And that's before battery storage becomes a real player in the Midwest as costs continue to drop.

"If you look at the problem the right way and ask: 'What does the grid really need?' It's not gas," said Mark Dyson, a principal in the electricity practice at the Rocky Mountain Institute. "It's energy, capacity, flexibility and other grid attributes. And there are combinations of alternative resources that can provide that and more as long as you can figure out how to represent that and value it in your planning process."

Dyson was co-author of a study in May that looked at just that issue — how renewables and distributed energy can be more effective alternatives to the "default" option for utilities, natural gas generation, in search of a replacement for retiring fossil and nuclear plants.

The report concluded that replacing gas, coal and nuclear capacity with natural gas through 2030 would cost $500 million, carry at least $400 million in fuel costs and lead to the release of 5 billion tons of carbon dioxide emissions over the same period.