MORGANTOWN – FirstEnergy subsidiaries Mon Power and Potomac Edison are asking the state Public Service Commission for more time to consider their possible purchase of the coal-fired Pleasants Power Station and closure of Fort Martin.
“Due to the potential closure of Pleasants by June 1, 2023,” they wrote to the PSC in their analysis report on the purchase, “time is of the essence and urgency in action is required if the commission wants Mon Power to evaluate the possibility of acquiring Pleasants.”
To allow time to weigh all the factors, they propose an interim solution to avoid a costly and difficult shutdown and restart, or demolition, of the plant.
Pleasants was owned by Ohio-based Energy Harbor, a former FirstEnergy subsidiary with three nuclear and two coal plants. In December, Energy Harbor transferred and then leased back Pleasants from Texas-based Energy Transition & Environmental Management (ETEM), which acquires operating and retired industrial properties with environmental challenges.
ETEM plans to demolish the plant and remediate the site but Energy Harbor will keep it open through May 31.
The interim solution involves Mon Power and ETEM entering into an arrangement for up to 12 months to keep Pleasants open while it considers and negotiates the purchase and conducts the regulatory proceedings.
Mon Power would need to execute a letter of intent regarding the arrangement, starting June 1, that would need a PSC OK.
Mon Power would also establish a temporary surcharge to customers to cover the costs – mostly labor – of keeping the plant open. This would add $2.67 per month to a residential bill, $8.44 per month to a commercial bill. True-ups would follow to ensure only actual costs are covered. This also would need PSC OK.
It is also asking PSC for consideration of further analysis and longer-term components of the purchase (and possible closure of Fort Martin outside Morgantown) in a near-future PSC proceeding.
They are asking for PSC action no later than April 25.
Case background
The PSC Consumer Advocate Division raised the issue of Mon Power buying Pleasants and closing Fort Martin during a rate hike proceeding that began last August and concluded in December. Part of the reason is that Pleasants has selective catalytic reduction (SCR) units — which remove the nitrogen oxide, NOx — from the plant’s air emissions, while Fort Martin doesn’t. SCR units will play a role in the EPA’s Good Neighbor Plan that will require power plants in 22 states to reduce their NOx emissions by 50% compared to 2021 levels.
Another reason, CAD said, is Pleasants has better access to coal supplies.
The companies note in their report that the Good Neighbor Plan poses challenges for Pleasants, too. Energy Harbor owns the plant’s 2023 NOx credits, and the plant has no credits allowing it to operate from May through September.
Mon Power said it previously believed that Energy Harbor would operate Pleasants through the fourth quarter of this year, but falling energy prices led it to decide to close the plant May 31. There are no current coal or lime contracts for the plant.
Energy Harbor planned to end employment by July 15, Mon Power wrote, but the Legislature’s passage of SB 609 in March has ETEM reconsidering demolition. SB 609 says, “No existing coal, oil, or natural gas fueled power plant shall undertake any decommissioning or deconstructing activities prior to obtaining approval” from the state Public Energy Authority.
Now, Mon Power said, ETEM is willing to consider a sale of Pleasants, a transaction that would allow transitional operation of Pleasants for possibly up to five years before demolition, or a forward sale of Pleasants with the deal to close after the site is remediated.
Problems associated with shutting down and then restarting Pleasants, Mon Power said, include lack of employees to restart it; re-firing cold boilers, turbines and transformers; and possible failure of fans and pumps.
“If the plant is going to continue to run or be available to run, then it is imperative that the existing staff of employees be maintained and that the plant components be kept ‘warm’ and operable,” Mon Power wrote.
If Pleasants it going to keep running past May 31, Mon Power told the PSC, if must notify PJM, the regional grid operator, by May 1.
And Mon Power implies it would rather not keep Fort Martin running along with Pleasants and Harrison. “The companies, at this point in time, do not believe operating three power stations as a long-term solution would be in the customers’ best interests.”
Other details
The state Legislature has endorsed Mon Power’s purchase of Pleasants through adoption of two resolutions in February: SR 29 and HR 12.
Energy Harbor, meanwhile, has been acquired by Texas-based Vistra Corp., another company with nuclear and fossil fuel assets. Vistra is acquiring only Energy Harbor’s nuclear assets, not Pleasants or W.H. Sammis in Ohio, another former FirstEnergy plant, which is undergoing shut-down, with layoffs to be completed by July 15.
West Virginians for Energy Freedom has previously voiced concerns about the Pleasants purchase and issued some comments in response to the report.
Emmett Pepper, policy director for Energy Efficient West Virginia, part of the coalition, said, “Mon Power is asking for a rate increase for 12 months to subsidize this plant without taking evidence on the prudence of the rate increase, whether paying for this plant will benefit ratepayers, and whether ratepayers even need its power. This is further evidence that we sorely need a competitive, market-based procurement process for energy in West Virginia that doesn’t constantly raise costs for families and businesses.”
The coaliton said the purchase “would transfer significant liabilities and costs from FirstEnergy investors onto West Virginians. Local customers of Mon Power and Potomac Edison utilities would pay for, maintain and accept liability for the aging Pleasants Power Station and pay a guaranteed profit for FirstEnergy’s investors.”
Tweet David Beard @dbeardtdp Email dbeard@dominionpost.com
