NJ BL England coal plant to shut unit, convert to natgas

June 21 Thu Jun 21, 2012 1:20pm EDT

June 21 (Reuters) - New Jersey's B.L. England coal power plant will shut down one coal unit and convert two other to natural gas to reduce air emissions, the New Jersey Department of Environmental Protection (DEP) said in a release Thursday.

This is another example of power companies opting to burn cleaner natural gas instead of coal to generate electricity.

U.S. power companies have announced plans to shut over 30,000 megawatts (MW) of coal-fired generation over the next few years as cheap gas prices and stricter environmental rules have made coal the more expensive option. See factbox

RC Cape May Holdings LLC, a unit of investment firm Rockland Capital with offices in New York and Houston that owns the plant, will shut the 113-megawatt (MW) coal-fired Unit 1 by the autumn of 2013, the DEP said.

The company will then repower the 155-MW coal-fired Unit 2 into a combined-cycle natural gas turbine and will re-fuel the 148-MW residual fuel oil-burning Unit 3 with natural gas by May 2016, the DEP said.

Unit 2 is to be shut down by May 2015 to allow for the conversion.

The 424-MW B.L. England plant is located in Upper Township in Cape May County, New Jersey, about 65 miles southeast of Philadelphia.

The DEP said the conversion will nearly eliminate the plant's emissions of smog-causing nitrogen oxides (NOx) as well as sulfur dioxide (SO2), which causes acid rain and haze.

The two coal-fired units at the plant are the last coal-fired units in the state without modern pollution control equipment, the DEP said.

The overall capacity of the plant would remain about 450 MW and could increase to about 570 MW, Jim Maiz, Senior Vice President for RC Cape May Holdings, said in the DEP release.

RC Cape May has owned the plant since 2007. This agreement resolves alleged violations of the federal Clean Air Act that occurred when the plant was under the ownership of Atlantic Electric, Conectiv and Washington, DC-based Pepco Holdings Inc , the DEP said.

Over the years, other power plants in New Jersey have been phasing out coal as a power source. Only six coal-fired units are still operating at four other power plants in New Jersey. But they all have modern pollution controls, the most recent being Public Service Enterprise Group Inc's Hudson station, the DEP said.

New Jersey Governor Chris Christie has pledged to oppose the opening of any new coal-fired plants in the Garden State, according to the release.