Howard’s blog

One More Illinois Coal Plant Down and Out by 2018

The Will County Unit 4 coal plant (525 MW) is on the way to its early retirement by 2018.  A few days ago, NRG quietly asked PJM for permission to “deactivate” this coal plant by May 31, 2018.  PJM’s “[r]eliability analysis [is] underway.”

NRG retired its Will County Unit 3 coal plant (251 MW) on April 15, 2015, but, for Will County Unit 4, NRG had aggressively sought an exemption for Illinois clean air SO2 standards.  NRG is converting its nearby Joliet coal plants to natural gas.  Now, NRG is moving to shut down the merchant Will County Unit 4 by 2018 unless power markets significantly change, thereby leading to carbon pollution reduction.

Here’s the story:

  • NRG’s plans to shut down the large Will County 4 coal plant recognizes the changing realities of the competitive electricity market with low natural gas prices, robust economical wind power resources, and energy efficiency holding down demand, as well as effective sustained litigation by the Environmental Law & Policy Center, Respiratory Health Association, Citizens Against Ruining the Environment – CARE, Sierra Club and other colleagues to enforce CWA and CAA regulatory standards and bring public pressure.
  • Electricity sales are down about 1% annually in Illinois and the Midwest due to energy efficiency.  That exacerbates the excess of generating supply over demand in the market.  It results in fairly low wholesale electricity market prices.
  • Natural gas prices are low – today, $2.07 MMBtu on NYMEX – and coal plants are not competitive on a fuel basis and, even less so, if any CWA and CAA retrofits are required.
  • NRG’s Joliet 6, 7 & 8 coal plants (1,468 MW) are converting to natural gas.  The Joliet coal plant is likely to be more profitable for NRG if it isn’t competing with NRG’s nearby Will County 4 coal plant.
  • The Illinois Pollution Control Board’s June 2015 Order adopting new temperature limits for Chicago-area waterways – the “thermal standards” long sought by ELPC and Sierra Club through rulemaking litigation before the Board – will require NRG to rebuild and retrofit the Will County Unit 4 and Joliet 6, 7 & 8 cooling systems within three years.  Hence, NRG’s announcement of the 2018 retirement date for Will County Unit 4.  Federal Clean Air Act standards also require significant retrofitting costs for Will County Unit 4.
  • NRG, overall, is under serious financial pressure, is cutting costs and appears reluctant to invest its shareholders’ money to modernize the Will County 4 coal plant.

This victory and the situation is reported well in this morning’s Crain’s Chicago Business article.

This is a big win for the Environmental Law & Policy Center and our partners’ longstanding work to force the clean up or shut down of the old, highly-polluting coal plants in Northern Illinois.  We expect that PJM will not find Will County Unit 4 operation to be needed for reliability and that power market conditions will not change enough for NRG to continue running Will County Unit 4 as a coal plant after 2018.  Indeed, this coal plant might be retired even sooner.

Please let the ELPC team know if you have any questions or suggestions.

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