PENNSYLVANIA
The largest of the iconic big-iron coal-fired power plants in the iconic coal state of Pennsylvania will shut down by June 2. According to the Pa. Environment Digest Blog, NRG, operator of the Homer City generating plant, told the PJM Interconnection regional transmission organization March 31 it would shutter the three-unit, 1,915-MW plant 50 miles east of Pittsburgh in 90 days. Homer City had to make a decision on continued operation before an April 4 deadline for participating in PJM’s upcoming 2023/2024 base residual auction.
The announcement was not a surprise. A year ago, NRG hinted that Homer City’s life was in serious jeopardy. The 1969-vintage plant, the local Sierra Club noted, “has been struggling to compete economically for years, having operated at less than half capacity every year since 2015, and at only 20% of capacity in 2022.” The generating station has seen multiple owners over the years, including Edison International, General Electric, and, most recently as a result of a 2017 bankruptcy filing, a consortium of hedge fund and individual investors.
The Environment Digest, edited by David Hess, former secretary of the Pennsylvania Department of Environmental Protection, observed, “Homer City based its decision on several factors including the low price of natural gas, a dramatic spike in the cost of its ongoing coal supply, unseasonably warm winters and increasingly stringent environmental regulations.”
Hess added that Homer City management said the decision was partly driven by the possibility that the state would join the Regional Greenhouse Gas Initiative (RGGI), which runs a market for pricing carbon dioxide emissions. While the state has said it wants to join RGGI, the application is on hold during court challenges.
Two other large Pennsylvania coal-fired plants—1,700-MW Conemaugh and 1,700-MW Keystone are scheduled to shut down in 2028. A fourth plant—1,500-Montour — plans to stop burning coal in 2025. Only eight smaller, coal and coal waste-fired plants in the Keystone Stated, the largest being the 520-MW Seward waste coal plant, remain connected to the PJM grid.
NEW MEXICO
New Mexico’s Supreme Court is considering a case by a Navajo energy company to keep the giant Four-Corners coal-fired power plant in service, despite the plan by the plant’s part owner, Public Service Company of New Mexico (PNM), to shut down the 1,540-MW, two-unit plant. PNM agreed kill the two remaining units of what was originally a five-unit, 2,040-MW station as part of a failed merger with Spain’s giant Iberdrola energy company.
The plant, located on land leased from the Navajo Nation, is jointly owned by Arizona Public Service 63%, PNM 13%, Salt River Project 10%, Tucson Electric Power Co. 7%, and Pinnacle West Capital Corp. 7%). PNM operates the plant.
PNM had proposed to transfer the plant to the Navajo Transitional Energy Co., the Associated Press reported. But in December 2021, the New Mexico Public Regulation Commission rejected both the transfer of the plant and the sale to Iberdrola’s U.S. subsidiary, Connecticut-based Avangrid. So PNM decided to return to an earlier plan to shut the two remaining units by 2031.
The Navajo corporation asked the court to overturn the 2021 decision by the regulators, giving the tribe a chance to overturn the decision to close the plant, preserving the economic benefits, including many jobs associated with the plant. The AP accounted noted, “The majority owner — Arizona Public Service Co. — hasn’t indicated any plans to end operations before 2031 because doing so could undermine the reliability of that utility’s network.”
MONTANA
Colstrip, Montana’s large, historic 1,480-MW coal-fired generating station, lives…for now. E&E News reported Mar. 31, “Two Washington state utilities have announced plans in recent months to transfer their ownership interests in a massive Montana coal plant to a pair of power companies that intend to operate the facility for years to come.” The first two of the former four-unit plant burning low-sulfur, low-Btu coal shut down last year.
Washington utilities Avista Corp. and Puget Sound Energy have agreed to spin off their share of Colstrip in 2025 to two utilities serving Montana. E&E news speculated that this “raises the possibility that the coal behemoth will continue releasing carbon dioxide into the atmosphere — blunting attempts by Washington lawmakers to curb planet-warming pollution.” The two operating units had been scheduled to shut in 2025.
The current ownership of Colstrip consists of Puget Sound Energy, Talen Energy, (whose Montana subsidiary operates the plant), Avista, Portland General Electric and PacifiCorp, both based in Oregon, and South Dakota’s NorthWestern Energy, which sells electricity in Montana.
In February, the Billings Gazette reported that Portland General and PacifiCorp have decided to back off a plan to unload their Colstrip shares in 2025 and will stick to an earlier deadline of 2030. Portland General’s Tomás Morrissey said, “We have been assuming the plant exits the portfolio at the end of 2025. However, due to some uncertainty, we’re revising this assumption in the [integrated resource plan]. We’re now assuming that PGE off takes power from Colstrip through the end of 2029.”
KENTUCKY
The Kentucky legislature has passed legislation, that went into effect March 24, that aims to prevent the shutdown of coal-fired power plants by utilities under the regulatory jurisdiction of the Kentucky Public Service Commission. According to the Washington law firm of Frost Brown Todd law firm, with offices in Kentucky, “The bill, criticized both by electric utility executives and environmentalists, creates a rebuttable presumption against the retirement of fossil fuel-fired electric generating units—coal, natural gas, and oil—by utilities that are regulated by the Kentucky Public Service Commission (KPSC). The KPSC may not approve the retirement of a fossil fuel-fired electric generating unit (EGU), or any type of cost recovery associated with the retirement, unless the utility can overcome a rebuttable presumption against the retirement of fossil fuel-fired EGUs.”
The law firm added, “Because the bill was passed with an emergency clause, it went into effect immediately upon being sent to the Kentucky Secretary of State on March 24th. Governor Beshear had 10 days to sign or veto the bill, but after taking no action for 10 days, the bill became veto-proof under state law and was submitted to the Secretary of State.”
–Kennedy Maize
To subscribed to The Quad Report, use the email address and type “subscribe” in the subject line. To comment, use the email address.