December 1, 2009 / 8:51 PM / 9 years ago

UPDATE 2-Progress to shut 11 unscrubbed coal units in NC

(Adds specific plants, comment)

HOUSTON, Dec 1 (Reuters) - Progress Energy’s PGN.N Carolina electric utility will shut 11 coal-fired units totaling nearly 1,500 megawatts by 2017 as it shifts to cleaner-burning natural gas to reduce emissions of carbon dioxide and other pollution, the company said on Tuesday.

The 40- and 50-year-old coal units, representing 30 percent of the utility’s coal fleet in North Carolina, do not have flue-gas desulfurization controls or scrubbers, the company said in a regulatory filing.

The plant retirements will reduce emissions of CO2, sulfur dioxide, nitrogen oxides and mercury, Progress said.

“This is a significant commitment to clean air in our state and a major down-payment on our company’s carbon-reduction strategy,” said Bill Johnson, Progress Energy chief executive, in a statement.

In October, the North Carolina Utilities Commission approved Progress’ plan to build a 950-MW combined-cycle gas plant in Wayne County to replace the nearby three-unit 397-MW Lee coal plant in 2013. Regulators also ordered Progress to create a plan to retire its other unscrubbed coal units in the state.

In response, Progress said it will permanently shut the 600-MW Sutton Plant near Wilmington in 2014, the 316-MW Cape Fear Plant near Moncure and the 172-MW Weatherspoon Plant near Lumberton by the end of 2017.

Progress spokesman Mike Hughes said the company will seek regulatory approval to build a gas plant at the Sutton site. Due to the plant’s location on the eastern edge of the Progress service territory, replacement power is needed to maintain system reliability, he said.

The utility also is looking at options to convert some equipment at the Cape Fear and Weatherspoon sites to burn wood waste to meet a state renewable energy requirement. Natural gas plant options will also be studied, Progress said.

Progress will continue to rely on coal generation to meet its electric demand, said Lloyd Yates, president of Progress Energy Carolinas.

“But as environmental regulations continue to change, and as even more significant rule changes appear likely in the near future, the costs of retrofitting and operating these plants will increase dramatically,” Yates said.

“It’s a combination of economic and environmental reasons,” Hughes said. “We view the switch to natural gas as a bridge fuel,” Hughes said.

To reach carbon reduction levels being debated in Congress by 2050, utilities will have to increase reliance on nuclear power which does not emit CO2, he said.

Progress will operate three North Carolina coal plants after 2017 in which it has invested more than $2 billion for emission controls. They include the 2,424-MW Roxboro Plant and the 742-MW Mayo Plant, both in Person County, and the 376-MW Asheville Plant in Buncombe County. (Reporting by Eileen O’Grady; Editing by Christian Wiessner) ((eileen.ogrady@thomsonreuters.com; +1 713 210 8522; Reuters Messaging: eileen.ogrady.reuters.com@reuters.net)) ((For help: Click “Contact Us” in your desk top, click here [HELP] or call 1-800-738-8377 for Reuters Products and 1-888-463-3383 for Thomson products; For client training: training.americas@thomsonreuters.com ; +1 646-223-5546))

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