Dive Brief:
- Four subsidiaries of FirstEnergy and American Electric Power filed their integrated resource plans for West Virginia's future power production, and the Charleston Gazette-Mail reports that there are stark differences in how the utilities are considering different investments in power resources.
- Appalachian Power and Wheeling Power, owned by American Electric Power, will still need coal power but intend to add more wind and solar energy into the mix towards 2025.
- In contrast, FirstEnergy subsidiaries Mon Power and Potomac Edison are considering increasing their reliance on coal, including purchasing another plant to meet an anticipated 700 MW capacity shortfall.
Dive Insight:
James Van Nostrand, a West Virginia University law professor and the director for Energy and Sustainable Development was skeptical over how First Energy's move to purchase another coal is a good idea. "It's shocking if they get away with buying more coal," he told the Charleston Gazette-Mail.
While First Energy's plans do call for retrofitting its Harrison and Fort Martin coal plants to use gas, it is also considering purchasing an already-existing coal generation facility. “It’s a tale of two utilities, in terms of one that gets it and another that is sticking its head in the sand," said Van Nostrand.
The "other" is American Electric Power, and its emphasis on diversifying its resource base.
This was the first year that the utilities' plans were required by law to be public. Despite that, one plan is more specific than the other. Appalachian Power, in an attempt to predict how the Clean Power Plan will impact their generation, estimated $15 price on every ton of carbon emitted. FirstEnergy's model, however, determined coal remained its least-cost solution but did not disclose its own carbon pricing estimates.
“We are not providing the calculations behind carbon dioxide or other aspects of our levelized cost analysis,” a spokesman for Mon Power and Potomac Edison told the paper.
Much like the two utilities, West Virginia leadership has been split on how it will deal with the Obama Administration's signature environmental legislation, the Clean Power Plan. While the state's attorney general has joined others in a court challenge opposing the law, Gov. Earl Ray Tomblin (D) has said the state will submit a compliance plan rather than be forced to accept the federal strategy.
Appalachian Power President Charles Patton, speaking at an energy summit in October, said new coal plants are no longer competitive, even absent new environmental rules.
“With or without the Clean Power Plan, the economics of alternatives to fossil-based fuels are making inroads in the utility plan,” Patton said. “Companies are making decisions today where they are moving away from coal-fired generation.”