COAL

The Columbus Dispatch - - Mar­ket Sum­mary - Dgearino@dis­patch.com @dan­gearino

En­ergy an­a­lysts note, how­ever, that changes in the elec­tric­ity mar­ket have made the plan much less rel­e­vant than it was just a few years ago.

“The Clean Power Plan is a good idea whose use­ful­ness has been by­passed by tech­no­log­i­cal in­no­va­tion in wind, so­lar and nat­u­ral-gas pro­duc­tion,” said Jim Lazar, a con­sul­tant to util­ity reg­u­la­tors who is based in Wash­ing­ton state.

“If you’re think­ing about some­thing new, you’re go­ing to build wind or so­lar or gas,” he said. “You’re not go­ing to build coal.”

The in­no­va­tion has meant a re­duc­tion in costs to build new wind farms and so­lar ar­rays, and the abil­ity to ex­tract large amounts of nat­u­ral gas through hy­draulic frac­tur­ing (frack­ing).

“I def­i­nitely don’t see any new coal gen­er­a­tion,” said An­drew Bischof, an eq­uity an­a­lyst who cov­ers util­i­ties for Morn­ingstar.

This dy­namic is in ac­tion in Ohio’s cur­rent coal-fired power plants.

There are 10, ex­clud­ing some small ones op­er­ated by lo­cal govern­ments or non-en­ergy com­pa­nies.

Two of the plants — J.M. Stu­art and Killen Sta­tion, both in Adams County in south­ern Ohio — are sched­uled to close next year. Both are owned by a power-plant sub­sidiary that is af­fil­i­ated with Day­ton Power & Light, a util­ity.

The state’s largest coal-fired plant changed hands last year. An AEP sub­sidiary sold the Gen­eral James M. Gavin plant to a part­ner­ship of pri­va­tee­quity firms, Light­stone Gen­er­a­tion.

Gavin, lo­cated near Cheshire in south­west­ern Ohio, has a ca­pac­ity of 2,600 megawatts, and is run­ning nearly con­stantly, hav­ing gen­er­ated more than 10 mil­lion megawatthours from Jan­uary to July, ac­cord­ing to the En­ergy In­for­ma­tion Ad­min­is­tra­tion.

At a coal plant, a megawatt can pro­vide for the needs of about 1,000 houses. But the fed­eral data show that many of Ohio’s coal plants are op­er­at­ing at much less than full ca­pac­ity.

The state’s sec­ond-largest coal-fired plant is Car­di­nal, op­er­ated by an AEP sub­sidiary and lo­cated near Bril­liant in eastern Ohio. AEP has said it con­tin­ues to re­view its power plant port­fo­lio, which could end with a sale or clos­ing of plants.

Akron-based FirstEn­ergy also is look­ing to di­vest its Ohio power plants, which in­cludes the W.H. Sam­mis plant in eastern Ohio.

“A re­peal of the Clean Power Plan does not change FirstEn­ergy’s de­ci­sion to exit com­pet­i­tive gen­er­a­tion, which is based on chal­lenges of op­er­at­ing in a com­pet­i­tive mar­ket,” said Stephanie Wal­ton, a FirstEn­ergy spokes­woman.

The coal in­dus­try had ar­gued that the Clean Power Plan is part of an anti-coal agenda and down­played the role of mar­ket forces in harm­ing the in­dus­try. The re­peal now will be­come part of the com­plex reg­u­la­tory process that al­ready was han­dling the im­ple­men­ta­tion of the rules.

The re­peal “will greatly ben­e­fit ratepay­ers in the state,” said the Ohio Coal As­so­ci­a­tion in a state­ment this week, not­ing that coal is used to gen­er­ate more elec­tric­ity in the state than any other fuel.

In the long run, how­ever, coal pro­duc­ers will need to see new coal-fired plants built to re­place the ones that are clos­ing to re­place lost rev­enue, and there are few signs of that hap­pen­ing.

Mean­while, sev­eral nat­u­ral gas, wind and so­lar projects are in var­i­ous stages of plan­ning and con­struc­tion across the state.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.