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Struggling to Compete with Natural Gas, Pennsylvania Coal Plant Files for Bankruptcy

January 14, 2017

Homer City Generation, operator of a three-unit, 1,884-MW coal-fired generating station about 45 miles northeast of Pittsburgh, Pa., has initiated a voluntary, pre-packaged Chapter 11 case in the U.S. Bankruptcy Court for the District of Delaware.

The financial restructuring process is expected to eliminate more than $ 600 million in existing secured debt from Homer City’s balance sheet and provide for an orderly transition of ownership, according to the company. The plant expects to continue operating, and to meet its ordinary obligations, as the case proceeds.

Filing a pre-packaged Chapter 11 case means the company has already arranged the necessary approvals for its proposed plan of reorganization. By doing so, the company is able to expedite the process, while eliminating some of the uncertainty.

Homer City has been struggling due to depressed power market prices, resulting from the low cost of natural gas. Located virtually in the center of the Marcellus Formation, Homer City’s finances have been doomed by the abundance of natural gas, combined with higher environmental compliance costs.…

17 U.S. Nuclear Units Have Components Forged at Site Under Investigation

January 12, 2017

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Although AREVA recently disclosed that 17 U.S. nuclear power plant units have installed components that were forged at the Le Creusot facility in France—a forge that has been under scrutiny due to questionable quality assurance documentation and carbon segregation irregularities in some parts manufactured at the site—the Nuclear Regulatory Commission (NRC) does not consider the situation an immediate safety concern.

“We are confident at this time that there are no safety concerns for U.S. nuclear power plants raised by the investigations in France,” David McIntyre, public affairs officer for the NRC, wrote in a blog post about the revelation.

“Our confidence is based on the U.S. material qualification process, preliminary structural evaluations of reactor components under scrutiny in France, U.S. material aging-management programs, our participation in a multinational inspection of Creusot Forge, and information supplied by AREVA about the documentation anomalies. Also, the components supplied to U.S. plants have performed well and inspections during their operating life have revealed no safety issues,” he continued.…

Experts: If Clean Power Plan Perishes, GHG Regulation Almost Certain Under NAAQS Program

January 8, 2017

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If the Clean Power Plan is scrapped or weakened, the Environmental Protection Agency (EPA) may be forced to regulate greenhouse gases (GHGs) emitted by existing power plant with wider repercussions under its National Ambient Air Quality Standards (NAAQS) program, experts have warned.

While President-Elect Donald Trump promised to “scrap” the Clean Power Plan during his presidential campaign, the power sector has grappled with regulatory uncertainty since the Supreme Court issued a stay of the rule that establishes the first federal GHG limits for existing fossil fuel–fired power plants in February 2016. The rule, finalized in 2015 under Section 111 (d) of the Clean Air Act, has deeply divided the nation and U.S. power sector.

Eighteen states (plus the District of Columbia) supported the rule in the merits litigation: California, Connecticut, Delaware, District of Columbia, Hawaii, Illinois, Iowa, Maine, Maryland, Massachusetts, Minnesota, New Hampshire, New Mexico, New York, Oregon, Rhode Island, Virginia, Vermont, and Washington. A number of power companies are also participating as intervenors, including Calpine, Pacific Gas & Electric, NextEra, and Southern California Edison Co.…

U.S. LNG Exports Surge in 2016—But Not Where They Were Expected

January 6, 2017

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The U.S. took a big step toward becoming a major exporter of liquefied natural gas (LNG) in 2016 as Cheniere Energy’s Sabine Pass export terminal in Louisiana came online early last year and upgrades to the Panama Canal that opened in June made shipments to the Pacific region considerably easier. Data from the Department of Energy (DOE) through December 2016 show the U.S. exported 109 billion cubic feet (Bcf) of LNG through December 16, an average of about 0.3 Bcf/d for the year as a whole.

But the predominant destinations were not what most experts had predicted. Despite signs that U.S. LNG would seek out high-priced markets in east Asia and lower-priced-but-still-attractive markets in Europe, the majority of exports went somewhere else entirely: Latin America.

DOE data show that only two shipments went to Europe (one to Spain and the other to Portugal) while only a single one went to China, for a total of just 9.7 Bcf. Four shipments went to India, totaling 13.8 Bcf.…

THE BIG PICTURE: Presidents on Power

January 4, 2017

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The post THE BIG PICTURE: Presidents on Power appeared first on POWER Magazine.

POWER Magazine…

U.S. Electric Markets in Transition

January 2, 2017

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The U.S. market for electricity is trifurcated. More than half the country is served by competitive generators bidding against each other in wholesale markets. Almost half is served by conventional state-regulated, vertically integrated utilities controlling generation and transmission. The rest, a much smaller portion, consists of government-owned and customer-owned utilities, some of which are generators and most of which serve retail customers. All categories are in transition.

In October 2016, the Public Utilities Commission of Ohio (PUCO) offered Akron-based FirstEnergy a five-year, $ 600 million subsidy to be paid by the utility’s customers. The move was designed to compensate for the investor-owned utility’s (IOU’s) large, baseload coal and nuclear plants’ inability to compete in the PJM competitive wholesale market against low-cost natural gas.

Consumer groups slammed the PUCO order as “corporate welfare.” Tony Addison of AARP said the PUCO decision means that “Ohioans should subsidize the failing business model of FirstEnergy.” This, Addison said, “creates a terrible precedent by PUCO and others to bailout companies threatening to leave the state, on the backs of the people that work hard and pay their bills every month.”…