American Municipal Power Inc., an Ohio-based wholesale electricity provider that supplies power to several Michigan communities, abandoned plans for a new coal-fired power plant last week after learning that the cost of emissions control technology increased the price of the project by 37 percent.
Marc Gerken, AMP President/CEO said in a statement:
The conversion of this project from coal to natural gas combined cycle would reduce capital costs and fit well into AMP’s carbon strategy. With AMPGS, we found ourselves in the unique position of having a project that was solid from the participant, permitting and policymaker support perspective, but the new target price resulted in price projections with little or no margins compared to market power, calling into serious question the project’s economic benefit to participating communities.
Jackson-based Consumers Energy is also planning a new coal plant for its Karn-Weadock facility in Bay City, though the project has not yet been granted an air permit by the Department of Environmental Quality.
Coal power development is strongly opposed by environmental groups that point out that coal plants are the leading emitters of the greenhouse gas carbon dioxide and of the neurotoxin mercury which has contaminated fish throughout the Great Lakes. The dangers associated with disposal of coal ash is also receiving increased attention by regulators.
Earlier this year Governor Granholm directed the Michigan Public Service Commission and the Department of Environmental Quality to consider whether coal plants the most feasible and prudent way of meeting the state’s declining need for electricity.
The Jackson Citizen Patriot reports that Consumers Energy estimates it will have to spend $1.32 billion over the next eight years to come into compliance with new emissions rules.
The utility has 12 coal-fired units at its four complexes across the state. They burn about 10 million tons of coal annually, representing 70 percent of Consumers’ electricity. That amount of coal use creates 700 to 900 pounds of mercury.