* AEP to reduce costs by running units part-time
* Units to remain available for peak summer/winter months
* Units did not run much over past few years
NEW YORK, May 27 (Reuters) - American Electric Power Co Inc (AEP.N) planned to run 10 small coal-fired power units on a part-time basis starting in June as the weak economy reduced demand and low natural gas prices have made the use of some coal units less profitable, a company spokesman said Thursday.
The spokesman, Pat Hemlepp, said AEP, of Columbus, Ohio, would place the coal units, which are older, smaller and less efficient, in “extended start-up” status beginning June 1 and redeploy some employees.
With the federal government looking to impose a cost on carbon emissions to combat global warming and environmental regulations becoming increasingly stringent year over year, several power companies, including Exelon Corp (EXC.N) and Progress Energy Inc PGN.N, have already announced plans to retire some older, less efficient coal plants.
Hemlepp said this was part of AEP’s effort to reduce costs after the recession reduced consumer power demand and a decline in natural gas prices made gas plants less expensive than the older coal units in the company’s Eastern footprint.
In April, AEP said it would launch a companywide buyout program to cut its workforce by 1,000 to 2,000 jobs, or 5 percent to 10 percent, as the poor economy continued to squeeze power demand. [ID:nN15255252]
Together the units, which Hemlepp said have not run much over the past few years, can generate close to 2,000 megawatts - only a small sliver of AEP’s 38,000 MW generating capacity. One megawatt powers about 1,000 homes.
AEP plans to make the old coal units available during the peak summer months of July and August when consumers crank up their air conditioners and January when they turn up their heating systems.
During the other months, Hemlepp said the units would be available to run with about four days notice.
The units include: Unit Size Year Town/County State Picway 5 100 MW 1955 Pickaway County OH Muskingum River 4 215 MW 1958 Beverly OH Clinch River 3 235 MW 1961 Carbo VA Tanners Creek 1 145 MW 1951 Lawrenceburg IN Tanners Creek 2 145 MW 1952 Lawrenceburg IN Glen Lyn 5 95 MW 1944 Glen Lyn VA Glen Lyn 6 240 MW 1957 Glen Lyn VA Philip Sporn 3 150 MW 1951 New Haven WV Philip Sporn 4 150 MW 1952 New Haven WV Philip Sporn 5 450 MW 1960 New Haven WV
Hemlepp noted that some of the plants have larger, more efficient units that will remain available for service all year. (Reporting by Scott DiSavino)