In late 2011, Columbus, Ohio-based AEP, one of the nation’s largest electric companies and coal burners, said it would close units 1-3 at Tanners Creek by mid-2015, instead of installing pollution controls to comply with the U.S. Environmental Protection Agency rules.
The decision to retire Tanners Creek 4 was made as part of an ongoing analysis of resource needs and environmental compliance costs, said Nicholas Akins, AEP president and CEO. With load growth largely flat in the aftermath of the 2008 national recession, AEP determined the more than 582,000 customers of its Indiana Michigan Power (I&M) subsidiary do not require additional generation at this time. I&M operates Tanners Creek, once considered one of the most efficient steam plants in the world when its four units went into commercial operation in the 1950s and early 1960s.
Paul Chodak III, I&M president and COO, said Tanners Creek “has served Indiana Michigan Power customers well for many decades. However, the plant’s age, combined with new environmental regulations, our successful energy efficiency programs and the fact that we currently don’t need additional generation make retirement the best decision for our customers.”
AEP considered repowering Tanners Creek 4 with natural gas, but concluded the estimated $65 million expense was too steep.
Tanners Creek has burned as much as 1.9 million tons annually of primarily low-sulfur Powder River Basin coal. The coal is railed to AEP’s Cook Coal Terminal on the Ohio River near Metropolis, Ill., then loaded onto barges for the journey upriver to Lawrenceburg. Cook has a 20-million tons per year transfer capability, including rail-to-barge transfer.
Previously, AEP announced the retirement of 6,676 megawatts of coal-fueled generation, mostly in the Midwest. With the addition of Tanners Creek 4, the company plans to retire 7,176 megawatts of coal-burning generation by early 2016.
In July, AEP also decided to retire, rather than convert to gas, a 585-megawatt coal unit at its 1,425-megawatt Muskingum River power plant on the Muskingum River near Beverly, Ohio. More than a year ago, the company said the plant would cease burning coal in 2015 because of environmental reasons.
Muskingum River burns central Appalachian coal, sometimes as much as 2.8 million tons annually. Unit 5 had burned as much as 1.5 million tons a year in the past, but less recently.
Despite the retirements, AEP officials stressed the company is not turning its back on coal. AEP intends to invest as much as $5 billion to add advanced pollution controls at some of its other coal plants, including 2,600-megawatt Rockport in Spencer County, Ind. Melissa McHenry, an AEP spokeswoman, said she knew of no plans by the company to close any additional coal-fueled generation.
In all, AEP owns more than 38,000 megawatts of generation capacity, of which about 23,000 megawatts is coal-fired. The compa