AEP Will Close 1,300-MW Indiana Coal Unit

A federal judge in Ohio on July 18 approved American Electric Power's (AEP's) plan to close Unit 1 of its two-unit, 2,600-MW coal-fired Rockport Plant in Indiana. The modified consent decree approved by the U.S. District Court for the Southern District of Ohio on Thursday is the latest chapter in a long-running dispute among AEP, the Sierra Club, the U.S. Environmental Protection Agency (EPA), and several states.

The Rockport consent agreement has been updated five times since 2007. That's when AEP reached a deal with states, environmental groups, and the EPA to settle charges that the utility's expansion of the Rockport plant occurred without the proper permits, and without installing the best available emissions controls, as required by federal law.

As part of the court battle, AEP two years ago was ordered to install scrubbers at Rockport's Unit 2, a move that the utility said would have cost it $1.4 billion. The judge's ruling today means the utility will not have to make that upgrade.

AEP in a news release Thursday said: "American Electric Power today announced that the U.S. District Court for the Southern District of Ohio has approved a modified agreement that will accelerate emissions reductions from the company's remaining coal-fueled power plants in the Midwest, eliminate a requirement to install high-cost emission reduction equipment at the company's Rockport Plant in Rockport, Indiana, and retire Rockport Plant Unit 1 (1,300 megawatts) by the end of 2028."

Unit 1 at Rockport came online in 1984. Unit 2 entered commercial service in 1989. The plant is located about 35 miles east of Evansville, Indiana, along the Ohio River. Rockport was honored as Large Plant of the Year by the Powder River Basin Coal Users' Group in 2009.

The Rockport announcement comes one day after Colorado-based Tri-State Generation and Transmission Association announced it would move up the closing date for its coal-fired Nucla Station in western Colorado. Tri-State said it plans to retire the plant in early 2020; it originally was set to be closed by year-end 2022.

The Sierra Club in a news release Thursday said the closure of Unit 1 at Rockport makes it the largest coal-fired unit to announce retirement since the environmental group in 2010 began pushing for the closure of U.S. coal plants. The group said almost 145 GW of coal-fired generation has been retired this decade.

The U.S. Energy Information Administration earlier this year said coal's share of U.S. power generation is expected to average about 24% this year, down from 27% in 2018.

'Focused on Renewable Generation'

"We invested nearly $9 billion in capital since 2000 to drastically cut emissions from our coal-fueled power plants," AEP CEO Nicholas Akins said in a statement Thursday. "Today, our investments are focused on renewable generation and advanced technologies that enhance service for our customers. This shift in focus achieves ongoing emission reductions and provides the resources and services that our customers have told us they expect from their energy company."

AEP throughout the process has denied allegations that the utility violated provisions of New Source Review (NSR), a Clean Air Act permitting program. The Trump administration has said it wants to revise NSR.

U.S. District Judge Edmund Sargus did not make a final decision on whether AEP violated EPA's NSR rules. Groups arguing against the utility said AEP did modifications to its power plants without the proper permits, and was not installing the best technology to control plant emissions of sulfur dioxide (SO₂) and nitrogen oxides (NO_x).

Earlier Targets for Emissions Reduction

With Thursday's modification of the original settlement agreement, AEP's Indiana Michigan Power operating unit now will operate enhanced dry sorbent injection equipment on the two coal units at Rockport beginning in 2021, resulting in an SO₂emissions rate of 10,000 tons or less annually. The original agreement called for those emissions levels to be reached in 2029.

Indiana Michigan Power also will use selective catalytic reduction (SCR) technology on Unit 2 at Rockport no later than June 1, 2020, to reduce NO_x emissions. AEP also will cut annual SO₂emissions from its Midwest coal plants to 89,000 tons per year by 2029, compared with the current cap of 113,000 tons per year.

Margrethe Kearney, senior attorney with the Environmental Law & Policy Center, the counsel for 11 of the citizens groups arguing against AEP, in a statement said: "This agreement is a substantial step in the right direction, reducing emissions and ensuring the retirement of a significant source of pollution in Indiana."

AEP in a news release said it has retired more than 8,600 MW of coal-fired generation since 2011, and it plans to retire another 1,100 MW by the end of 2020. The utility said it has started operation of 724 MW of wind power and battery storage, and plans to add more than 9,100 MW of wind and solar generation by 2030.

-Darrell Proctor is a POWER associate editor (@DarrellProctor1, @POWERmagazine).

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