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Industry News

Illinois Power to Quit Midwest ISO, Join Alliance RTO

LCG, Sept. 21, 2000--Illinois Power Co. said yesterday it would quit the Midwest Independent System Operator and join the Alliance Regional Transmission Operator, pending approval from necessary regulatory bodies including the Federal Energy Regulatory Commission.

The company said it expects its withdrawal from MISO to be effective no later than December of next year, but the Midwest grid operator isn't so sure. MISO, however, offered no reasons why it expected the change to be delayed.

Illinois Power, which was one of the original nine utilities that formed MISO in January 1998, said one reason for the change was that membership in Alliance would provide "greater flexibility and cost savings while maintaining reliability in moving large amounts of electricity across the nation's transmission grid."

Another important consideration, Illinois Power said, is the fact that many members of Alliance operate in states that have electric choice, unlike most MISO members. Kathy L. Patton, general counsel for the utility, said "Now, with continued experience in the developing marketplace, membership in MISO is no longer the best option for (Illinois Power) and its customers."

A third consideration could be that the Alliance RTO plans to earn a profit on its operations.

Withdrawal from the nonprofit MISO is permitted members whose ownership of transmission assets changes. That condition was met with the merger of Illinois Power's parent holding company, Illinova Corp., with Dynegy Inc.

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