FirstEnergy Will Close Power Plants on Schedule
Washington PA Observer Reporter
3 October 2013
By Scott Beveridge, Staff Writer
MONONGAHELA – FirstEnergy will close two coal-fired power plants
in the Mon Valley as scheduled next week with no expectations the
company will sell or ever reopen them under stricter federal
clean-air regulations and other issues changing the electricity
market.
FirstEnergy President James H. Lash said the company has made jobs
offers within its system to 140 of 175 union workers affected by
the Wednesday deactivations of the Mitchell Power Station in
Washington County and the Hatfield plant in Greene County.
“We have not had anyone approach us with a proposal to purchase
them,” Lash testified Thursday before the state House Consumer
Affairs Committee at a hearing it held in Monongahela on the
reliability on the electric grid after the power plants close.
“We are not out there seeking to sell. We know what the market is,
what the offers would be. We would turn our head,” Lash said at
the hearing in Monongahela Fire Hall chaired by state Rep. Peter
J. Daley, D-California.
FirstEnergy met the requirement to give the electric grid
oversight group, PJM Interconnection, a 90-day period to review
the reliability of service before the stations are retired when it
announced the plant closings July 9, said Pamela A. Witmer, a
member of the state Public Utility Commission.
While PJM determined the grid will not be threatened by the plant
closings, Witmer testified she had concerns about 90 days being
enough time to test the future reliability of electricity with the
loss of 2,000 megawatts of power, which help to supply 1.5 million
Pennsylvania homes a year.
“That’s the bare minimum,” she said. “Did PJM have sufficient time
to examine all of the reliability concerns closely?”
Michael J. Kormos, executive first vice president of operations at
PJM, said there will be enough energy supplied by new natural
gas-fueled power plants within the large grid to compensate for
any coal-fired plants scheduled to retire.
“We are very confident these units can retire,” Kormos said.
The Hatfield and Mitchell stations employ 380 workers, and union
workers there who secure other jobs within FirstEnergy are being
asked to take concessions during current labor negotiations, said
Thomas Hall, executive vice president of Utility Union Workers of
America Local 102, which represents workers at the plants.
“There is no reason even one person has to a lose a job,” Hall
said.
He questioned the motivation for closing the stations after the
company already spent more than $700 million to improve their
pollution controls.
“Closing plants is never an easy decision and it’s not a decision
we take lightly,” Lash said.
He said the plants are losing money now at a time when demand for
electricity is flat and coal faces growing competition from the
low price of natural gas because of the boom of drilling into the
Marcellus Shale formation.
“We don’t see the demand for electricity picking up. The economy
has not been robust since 2008,” Lash testified.
He said the industry is uncertain about how the new federal
Environmental Protection Agency regulations will affect coal in
years to come as an energy source at a time when both plants need
to spend $270 million on upgrades to comply with the pending
rules.
“That’s a lot of money,” Lash said, adding the investment would
cause additional loses if the plants were to be kept open.
Daley said he planned to form a delegation to travel to
Washington, D.C., to meet with federal lawmakers on ways to
protect the coal economy in Pennsylvania.
“The ripple affect here is cataclysmic,” Daley said.
State Rep. Pam Snyder of Greene said 40 percent of that county’s
budget is made up from revenues from the coal industry.
“This story is bigger than this,” said Snyder, D-Jefferson.