Coal Age

MAR 2018

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Page 10 of 51

March 2018 9 news continued tion also was filed with the Federal Energy Regulatory Commis- sion in Washington, D.C. The proposed move prompted pushback from several groups including environmentalists who accused Akron, Ohio-based FirstEnergy of trying to saddle ratepayers with a power plant that no longer was economic to operate in the wholesale power market. PJM Interconnection's Independent Market Monitor also dis- agreed with the rationale for the proposed Pleasants purchase. On January 12, FERC rejected the Mon Power/Potomac pro- posal, although the utilities could have appealed the decision. And while the West Virginia PSC approved the sale, it attached several conditions that FirstEnergy said were "unworkable." Charles Jones, FirstEnergy president and CEO, said closing Pleas- ants "is a very difficult choice because of the talented employees ded- icated to reliable operation of the station and the communities who have supported the facility for many years. But the recent federal and West Virginia decisions leave FirstEnergy no reasonable option but to expeditiously move forward with deactivation of the plant." Both he and FirstEnergy spokeswoman Jennifer Young said the company will spend the remainder of the year trying to find a buyer for Pleasants, a move that could keep the plant open. Pleas- ants burns approximately 3 million tons of steam coal annually. FirstEnergy also notified PJM of its plans to deactivate the plant. The deactivation is subject to review by PJM, a Pennsylva- nia-based regional grid operator. Pleasants, consisting of two 650-megawatt generating units, currently has about 190 full-time employees. Since 2016, FirstEnergy has announced the sale or closure of 2,471 megawatts (MW ) of competitive generation operated in Ohio, Pennsylvania and Virginia. After Pleasants is deactivat- ed, the company will own or control generating capacity totaling about 14,795 MW from scrubbed coal, nuclear, natural gas and renewable energy facilities in Ohio, Pennsylvania, New Jersey, Vir- ginia and Illinois. Michigan Group Wants DTE Energy to Reconsider Retiring Coal Plants A major Michigan business group is pushing back against plans by the state's largest electric utility, DTE Energy, to retire three of its largest coal-burning generating stations by December 2023, largely replacing them with a new 1,100-megawatt (MW ) natural gas-fired plant. DTE, which serves 2.2 million customers in the southeast- ern part of the state, is seeking Certificates of Necessity from the Michigan Public Service Commission (PSC) to build the com- bined-cycle gas plant northeast of Detroit. The gas plant would be in commercial operation by 2022. By that time, the utility hopes to have shuttered, or be close to retiring, its River Rouge, St. Clair and Trenton Channel coal plants. DTE's remaining coal plants, Belle River and Monroe, which at 3,000 megawatts is one of the largest coal plants in the Midwest, also would be retired in later years under the company's plan to stop burning coal by 2050. DTE argues its coal fleet is old and would require millions of dollars in retrofits to comply with new environmental regu- lations. A better solution, it said, is to invest in a new gas plant that would be more efficient and about 50% cleaner than the coal The push toward a more open coal mining industry followed the Indian government approving commercial coal mining by private investors and having received "feelers" from international mining companies keen to secure coal blocks through competitive bidding at the forthcoming auctions. Government offi cials said with commercial coal mining by pri- vate miners around the corner, the relevance of captive mining by user industrial currently in vogue with end-use restrictions would gradually lose relevance. Hinting at a possibility of captive mining being subsumed by advent of commercial coal mining in the country, Susheeel Kumar, secretary to the federal Ministry of Coal said, "We can also take a decision in the future that only commercial coal mining will prevail. We have the experience in end-use auction of coal blocks. Auction of blocks for commercial mining will be another experience. We can always compare the two and conclude which is better for the coun- try in the long term." "Our expectation is to complete the process of auction of coal blocks for commercial mining to be completed by March 31, 2018," Kumar said. There has been no indication from the government on the number of blocks to be put up for bidding, but sources said that in the fi rst tranche, at least 10 blocks would come up for bidding for private domestic and global miners. At present, Indian coal mining is divided into two tiers — min- ing by government-owned companies, Coal India Ltd., Singareni Collieries Co. Ltd. and NLC Ltd. since the sector was nationalized in and mining by user industries like steel, cement and thermal power generation. However, as a precursor to a possible commercial mining sub- suming captive mining, the Ministry of Coal has already started relaxing end-use restriction of production from captive mines. To ensure optimal use of coal blocks allocated to various gov- ernment-owned thermal power companies, the government would henceforth permit swapping of coal between two such companies. The swap would be permitted between two government ther- mal companies on the condition that both have been allocated coal blocks under the government's preferential allotment dis- pensation or one with a coal block and the second having con- fi rmed supply linkage with either Coal India Ltd. or other coal min- ing company. The swap could be either in terms of volumes of coal trans- ferred from one power company's mine to the other with the recipi- ent returning the volume at a later date or accept the fuel in lieu of generated electricity to the coal supplying power company. Government offi cials said that by removing end-use restric- tion, captive coal mine operators would be able to signifi cantly ramp up production and go in for merchant sale of the production in excess of its own requirement. The Coal Ministry in a perspective plan has estimated that coal production from captive coal mines could go up to levels of 105 million tons per year by 2030, up from current levels of about 37 million tons per year. According to perspective planning by the Ministry for Power for 2018-2019, total coal demand for thermal power plants has been pegged at 603 million tons, of which 513 million tons were expected from Coal India Ltd. and the balance 90 million tons from Singareni Collieries Company Ltd. and captive blocks operated by power companies. Continued from p. 7...

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