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Midwest utilities retire more than 2,000 MW of coal-fired generation

Louisville, Kentucky (Platts)--15 Apr 2016 652 pm EDT/2252 GMT


Friday marked the retirement of another 2,000 MW of older coal-fired generation in the Midwest.

Though not unexpected, the coal retirements continued a trend in a region that for decades has relied heavily on coal to produce electricity. Coal still comprises a sizable share of the generation portfolio, but it is slowly being replaced by renewables, particularly wind, and natural gas.

The latest retirements were concentrated in Indiana and Michigan.

In Indiana, Indianapolis Power & Light shuttered its 341-MW Eagle Valley plant 67 years after it began operating. Eagle Valley is being replaced by a new 671-MW combined-cycle gas plant, whose construction is more than one-third complete and is targeted for commercial operation in spring 2017.

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IP&L also halted coal burning in February at its roughly 700-MW Harding Street plant in downtown Indianapolis.

Duke Energy Indiana, the state's largest electric utility and a subsidiary of Charlotte, North Carolina-based Duke Energy, closed Units 2, 3, 4, 5 and 6 at its 668-MW Wabash River station. Duke expects to decide by the end of 2016 whether to convert 318-MW Unit 6 to burn natural gas, according to company spokesman Lew Middleton.

In Michigan, Consumers Energy planned to pull the final switches on its "Classic Seven" coal units totaling 950 MW by midnight Friday, spokesman Dan Bishop said. The next major generation project the CMS Energy subsidiary pursues is expected to be the 700-MW Thetford combined-cycle gas plant that was deferred two years ago.

The Holland Board of Public Works also stopped burning coal in its 62-MW James De Young plant, constructed in 1940. Holland is replacing it with Holland Energy Park, a 125-MW gas-fired facility, said Ashley Kimble, spokeswoman for the Michigan muni.

The retiring coal plants for years burned several million short tons of thermal coal annually, both from low-sulfur Powder River Basin and higher-sulfur Eastern sources.

Iowa's MidAmerican Energy, meanwhile, announced plans Thursday to install up to 2,000 MW of new wind capacity by the end of 2019 as part of a $3.6 billion project.

By the end of 2016, wind is projected to represent 47% of the utility's generation portfolio. Coal still accounts for 31% and company spokeswoman Ashton Newman said Friday there are no plans to retire any coal generation.

--Bob Matyi, newsdesk@platts.com
--Edited by Jason Lindquist, jason.lindquist@platts.com

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