UPDATE 2-Georgia Power seeks to retire 15 coal, oil power units
* Georgia Power to retire over 2,000 MW
* Retirements due environmental rules and cheap gas
* Company to convert some coal plants to gas, biomass
Jan 7 (Reuters) - Georgia Power said on Monday it plans to seek approval from Georgia regulators to retire 15 coal-, oil- and natural gas-fired power plants in the state totaling 2,061 megawatts (MW) due primarily to the high cost of meeting stricter federal environmental regulations.
Over the past few years, U.S. generating companies have announced plans to shut about 40,000 MW of older coal-fired power plants as low natural gas prices have made it uneconomic for the generators to spend millions to upgrade the plants' emissions systems to meet the latest federal and state environmental rules.
In a press release, Georgia Power, the biggest unit of U.S. power company Southern Co, said it wanted to shut units 3 and 4 at Plant Branch in Putnam County; units 1-5 at Plant Yates in Coweta County; units 1 and 2 at Plant McManus in Glynn County; units 1-4 at Plant Kraft in Chatham County; and units 2 and 3 at Boulevard in Chatham County.
The company said it plans to file its updated Integrated Resource Plan (IRP) with Georgia's utility regulators on Jan. 31.
Units 3-4 at Branch, units 1-5 at Yates and units 1-3 at Kraft are coal-fired units. Kraft Unit 4 and Boulevard 2 and 3 are fired by natural gas and oil. McManus units 1-2 are oil-fired.
The company said it expects to ask to retire the units, other than Kraft 1-4, by the April 16, 2015, effective date of the U.S. Environmental Protection Agency's (EPA) Mercury and Air Toxics (MATS) rule.
The company said it expects to seek a one-year extension of the MATS compliance date for Plant Kraft and retire those units by April 16, 2016. Georgia Power said it expects the state Public Service Commission (PSC) to vote on the company's request in the summer of 2013.
STRICTER ENVIRONMENTAL RULES
The company said several factors, including the cost to comply with existing and future environmental regulations, recent and forecasted economic conditions, and lower natural gas prices contributed to its decision to close these units.
"We are in the midst of a significant transition in our fleet that will result in a more diverse fuel portfolio - including nuclear, 21st century coal, natural gas, renewables and energy efficiency - to ensure we maintain our commitment for generations to come," Georgia Power President and CEO Paul Bowers said in the release.
The company said it will also request that units 6 and 7 at Plant Yates switch from coal to natural gas, and Unit 1 at Plant McIntosh, near Savannah, switch from Central Appalachian coal to Powder River Basin coal.
The company said the conversion at Plant Mitchell Unit 3, in Albany, from coal to biomass cannot be completed before 2017. The company said it will base its decision to move forward with the conversion based on expected EPA rules.
For the rest of its fleet, including the units at plants Bowen, Hammond, Scherer and Wansley, Georgia Power said it is already installing additional environmental controls to comply with the environmental rules.
Georgia Power said it received approval in 2012 to retire Plant Branch units 1 and 2, which total 569 MW, effective Dec. 31, 2013 and Oct. 1, 2013, respectively; and Unit 4C at Plant Mitchell in Albany, totaling 33 MW, effective March 26, 2012.
Georgia Power currently operates 11,387 MW of coal-fueled generation at 10 plants across the state. Overall, the company has 18,623 MW of capacity, including nuclear, natural gas and hydro generation.
Georgia Power serves 2.4 million customers in Georgia.