By Scott DiSavino
Feb 25 U.S. power company American Electric
Power Co Inc will stop burning coal at three Midwest
power plants by 2015 to reduce air pollution as part of a
settlement with federal regulators, states and environmental
In a statement on Monday, the environmental groups said
the Ohio-based company, long known as the biggest coal generator
in the country, would retire a total of 2,011 megawatts (MW) of
coal-fired capacity at plants in Indiana, Ohio and Kentucky.
The groups, including the Sierra Club and Natural Resources
Defense Council, said AEP would stop burning coal at the 580-MW
Tanners Creek 4 unit in Indiana, the 615-MW Muskingum River 5
unit in Ohio and the 816-MW Big Sandy 2 unit in Kentucky.
Ohio-based AEP said in a statement that it also agreed to
install pollution control equipment on the two 1,300-MW
coal-fired units at Rockport, another power plant in Indiana, as
well as refueling or retiring the Tanners Creek 4 unit.
In the past, AEP said it was thinking about retiring Big
Sandy 2 by 2015, refueling or retiring Muskingum River 5 with
natural gas by 2017 and refueling or retiring Tanners Creek 4 at
Since President Barack Obama took office in 2009, power
companies, including AEP, have announced plans to shut more than
40,000 MW of coal capacity over the next several years as weak
gas prices pushed power prices to decade lows.
Those weak power prices have made it uneconomic for the
generators to invest in emission control equipment needed to
keep their older coal plants compliant with the administration's
stricter federal environmental rules.
AEP said prior to this agreement, its Indiana and Michigan
unit had requested approval from Indiana regulators for the
installation of a dry scrubber on one of the two 1,300-MW
Rockport units to satisfy environmental requirements.
The company said estimates for the single dry scrubber were
$1.4 billion. Given this high cost, AEP said it continued to
investigate alternatives and ultimately selected the lower cost
dry sorbent injection technology.
AEP said it entered into negotiations with the U.S.
Environmental Protection Agency (EPA), several northeastern
states, and various environmental groups to help keep the cost
of installing environmental controls for Rockport low for its
AEP said the cost of installing the dry sorbent injection
equipment on both Rockport units will be less than a fifth of
the cost of installing a dry scrubber on just one unit and will
still meet all environmental regulations.
AEP also said as part of the agreement, it will install an
additional 200 MW of wind power, among other things.
AEP said further emission reductions will be required at
Rockport in the next decade.
The Sierra Club said AEP will have to retire the two
Rockport units in 2025 and 2028 or install additional controls
to reduce sulfur emissions further.
The agreement settles a lawsuit originally filed in federal
court in Ohio in 1999, and is a modification to a prior 2007
settlement, according to the Sierra Club.
The agreement is subject to review and approval by federal
court, which AEP said is expected to occur within the next few