Homer City coal plant, the largest in Pennsylvania, will close by June

Homer

Almost a year to the day after its last existential decision, Homer City Generation announced it will retire its coal units in Indiana County over the next three months.

The state’s largest coal-fired power plant had considered deactivating some or all of its three coal units last spring, but then decided to stick with full operations after all.

It announced on Monday that it plans to be offline by June 2.

Then, as now, the company cited economic pressures — competition from cheap natural gas, power and coal prices, the cost of running the facility and complying with environmental regulations.

The facility will have “tiered layoffs” until June, the company’s announcement said. As of last year, Homer City had 129 employees.

The power plant follows in the well-worn footsteps of other coal plants that have shuttered in recent years and are now going through the decommissioning process, including Bruce Mansfield in Beaver County, Cheswick in Allegheny County and Hatfield’s Ferry in Greene County. In its announcement, Homer City noted that more than 60 coal plants have closed in the state over the past two decades.

“This is an unfortunate day for us at Homer City because we did everything possible to maintain our operations,” said Bill Wexler, president and CEO of Homer City. “We will continue to look to utilize all of Homer City’s hard assets, including its existing infrastructure, to find a higher and better use(s) to continue to support the community.”

While the materials at the plant have substantial salvage value, the hottest ticket for a closing coal plant might be its connection to the grid.

Interconnection rights, which must be approved by the regional grid operator PJM Interconnections, are a much coveted asset, especially for new solar and energy storage projects. Homer City’s interconnection rights remain for a year after the plant shuts down.

Already, there is a 230 megawatt solar project in wait for the area, according to PJM’s database.

Homer City buys coal from a mix of regional suppliers, but its biggest shipments come from Consol Energy Inc.’s Pennsylvania Mine Complex in southwestern Pennsylvania and Alliance Coal’s Tunnel Ridge Mine near Wheeling, W. Va., according to federal data.

With a capacity of around 1,900 megawatts -— enough to power 2 million homes — the massive plant was built in the 1960s and 1970s. It has been through two bankruptcies over the past decade. The most recent, in 2017 left it in the hands of private equity investors and hedge funds, with Mr. Wexler as CEO.

“I’ve spoken to all the employees, and I explained who we are and what we’re here to do to get this plant to be a far more profitable member of the community and to sell it,” he told the Post-Gazette in 2017.

Source: Post-gazette.com

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