EPA rules to force old coal plants to adapt, close

Miamisburg power plant may convert to natural gas to stay in operation.



MIAMISBURG — Facing the prospect of having to shut down a coal-burning power plant that employs 50, Dayton Power & Light said it’s studying a plan to repower the O.H. Hutchings Station plant here with natural gas as a way to keep the facility along the Great Miami River operating.

New U.S. Environmental Protection Agency regulations to reduce mercury and other heavy metals in smokestack emissions would shut the plant down within a few years.

Hutchings dates to the late 1940s and is the only DP&L plant that can’t meet new EPA regulations, the utility said.

Feasibility studies to replace coal units with natural gas should finish some time this year, said DP&L spokeswoman Lesley Sprigg. Natural gas burns cleaner than coal and has far lower carbon dioxide emissions.

Hutchings power generation has been declining over the years. “Due to less demand for energy in the region, significantly lower wholesale power prices and the age of the Hutchings plant, it is not called upon to run as much as it did in previous years,” Sprigg said.

Ohio utilities are facing the dilemma of closing plants versus refitting them following EPA rules issued in December. With an estimated $9.6 billion price tag, the rules rank among the most expensive in the EPA’s history. Utilities have until 2015 to 2016 to comply.

Some plants aren’t cost-effective to refit with more pollution-control devices, utilities say. But natural gas is becoming a more competitive alternative.

Besides the regulatory pressures on coal, massive newly drilled shale deposits in Ohio and Pennsylvania are keeping the price of natural gas competitive, further squeezing coal’s economics.

Consumers Energy announced in December that it was cancelling a controversial 830-megawatt coal power plant in Michigan that it planned to have in operation in 2017 because of reduced customer demand for electricity due to a weak economic recovery and lower natural gas prices linked to expanded shale gas supplies.

In 2011, according to the Public Utilities Commission of Ohio, coal supplied 86 percent of the state’s electric usage. Natural and other gasses supplied only 2 percent. But a study by the Massachusetts Institute of Technology projects that natural gas use will increase and reduce coal as a power source.

Today, coal remains the most common fuel for generating electricity in the United States. In 2010, 45 percent of the nation’s electricity used coal as its source of energy. Natural gas fueled 24 percent, federal figures say.

It’s still unclear how much more natural gas Ohio utilities might burn in years to come as the energy mix changes, said Matt Butler of the Ohio Public Utilities Commission.

“It’s a business decision for the utilities to decide if they want to retrofit for gas or go another route altogether,” he said.

Large Ohio coal plants will go dark within a few years. Duke Energy announced that the Walter C. Beckjord Generating Station in Clermont County east of Cincinnati will cease operating coal-fired units in 2015. The plant has produced energy for six decades.

“Due to the age and physical limitations of the Beckjord facility, the (new EPA rules) would require hundreds of millions of dollars — to which our customers would be exposed — to bring the plant into compliance. This fact, combined with a lower plant usage forecast, compelled Duke Energy Ohio to accelerate Beckjord’s anticipated retirement date,” Duke said.

Other Ohio utilities have announced coal-burning power plants headed for closure, including American Electric Power in Columbus. AEP said it would close two West Virginia plants and one Ohio plant, Picway.

Two other Ohio plants, Conesville and Muskingum River, would close generating units.

According to an Associated Press survey of 55 power producers, more than 32 mostly coal-fired power plants in a dozen states would close. The survey indicated no threat to the reliability of the nation’s power system.