DaytonDailyNews.com

DAYTON — Newly installed air pollution control equipment at Dayton Power & Light Co.'s Stuart and Killen electricity generating plants will give the utility the option of burning higher-sulfur coal that is cheaper, its parent company said.

The utility will be doing tests to determine how much of the higher-sulfur, northern Appalachian and Illinois basin coal it can mix into the lower-sulfur coal it currently burns to generate electricity, Paul M. Barbas, president and chief executive officer of DPL Inc., told industry analysts Friday, Feb. 22. DPL is the utility's parent company.

Barbas reviewed his company's 2007 financial performance for the analysts. DPL affirmed that it expects to earn between $1.90 and $2.10 per share this year, based on 118 million shares outstanding, and between $2.10 and $2.40 per share in 2009, based on 120 million shares outstanding.

Dayton Power & Light put one of its new scrubber units, which remove sulfur and other contaminants from power plant emissions before their release into the atmosphere, into operation last summer at the Killen plant. The first of four scrubbers began operating this month at the larger Stuart plant, with the other three to come on line by June. Both plants are along the Ohio River.

DP&L has not said publicly how much it expects to save by being able to burn higher-sulfur coal, company spokesman Tom Tatham said.

DPL has said its $500 million program to install emission-control equipment, to comply with more stringent federal clean-air laws, is the most expensive environmental investment in the company's history.

Barbas said that as the program winds down, the cash that is freed up will be invested in the company's power system and used to increase cash dividends for shareholders. He did not give details.

A spokesman for the Ohio Environmental Council said that as long as the scrubbers do their job in meeting clean-air requirements, his organization isn't concerned with which coal DP&L buys.

"It's what's coming out of the stack that's important, not what's going into the boiler," council spokesman Jack Shaner said.

Ohio is debating its long-term strategy for regulating electricity pricing, as the country's experiment with electricity deregulation has fizzled. DP&L and other Ohio utilities are lobbying for a strategy that would allow them to continue billing customers for the multimillion-dollar costs of air pollution control systems.

Shares of DPL (NYSE:DPL) closed at $26.26, up 12 cents for the day. It has ranged between $25.41 and $32.72 during the past year.

Contact this reporter at (937) 225-2242 or jnolan@DaytonDailyNews.com.

Power plant lawsuit

In 2004, the Sierra Club sued to allege that the Stuart plant's emissions violate the Clean Air Act. The lawsuit is pending in federal court in Columbus.

DPL Inc. told federal regulators on Friday, Feb. 22, that the judge presiding over the lawsuit granted a request last week by the parties to delay the proceedings for 60 days to determine if they could settle the case.

DPL said settlement talks are ongoing. A Sierra Club official and the organization's lawyer did not return calls for a response Friday.