Pennsylvania’s Largest Coal-fired Power Plant (Homer City) Plans for RGGI

by Duane Nichols on April 30, 2022

Homer City Power Plant with three separate units at 1884 MW max.

Homer City coal fired power station considers cutting operations in Penna.

From an Article by Patrick Cloonan, Indiana PA Gazette, 2/15/22

Operators of Pennsylvania’s largest coal-fired electric generating complex, the Homer City Generating Station in Center Township, Indiana County, has said they may reduce operations by May 2023, due in part to the Regional Greenhouse Gas Initiative (RGGI).

However, in a news release issued by Homer City Generation LP, the station’s ownership group since April 2017, its management said there would be no immediate impact on 129 employees there. “We’re proud of the investments we’ve made in the Homer City Generating Station and the work of our talented team of employees,” said Homer City Generation President and CEO William Wexler

Specifically, Homer City Generation LP said it may decide by April 4 whether to pull back some operations from a capacity auction PJM Interconnection LLC will conduct. Homer City Generation LP operates three generating units — two that started in 1969 and a third that was added in 1977 — and produces 1,884 megawatts of power fed into the PJM regional transmission grid.

PJM, the electrical transmission grid which covers Pennsylvania as well as all or part of 12 other states and the District of Columbia, is conducting the auction to procure power supply resources for the 2023-24 delivery year. (The capacity auction has been delayed until June of 2022.)

Homer City Generation officials said the company requested an exception to the must-offer requirement for some units. They said any deactivated units would be removed from service in May 2023.

In its release, Homer City Generation LP said any decommissioning decision would be based on a number of factors, including: Ongoing operating performance, The ability to support a one- or two-unit operation, Ongoing maintenance and operating costs, Forward power and coal prices, Availability of coal supply, and Regulatory uncertainties.

The latter include “those arising from the Commonwealth of Pennsylvania’s prospective entry into” RGGI, a regional compact seeking to cap and reduce carbon dioxide emissions from the power sector.

“The current ownership group at Homer City obtained the facility out of its second bankruptcy reorganization in 2017, but even prior to that time — and long before RGGI was proposed — there were discussions regarding its financial capacity to continue operations as the market forces for coal-fired electric generating units are challenging,” said Gov. Tom Wolf’s Press Secretary Elizabeth Rementer.

“That said,” Rementer continued, “the governor’s plan to participate in RGGI, as laid out in two pieces of identical legislation, House Bill 1565 and Senate Bill 15, would support workers impacted by closing facilities — facilities that have been closing without RGGI in place.”

HB 1565, sponsored by Rep. Dianne Herrin, and SB 15, sponsored by Carolyn T. Comitta, both D-Chester, would amend the state’s Air Pollution Control Act of 1960 to provide for “disposition of auction proceeds from (the) CO2 Budget Trading Program, for clean air fund accounts, for the Energy Communities Trust Fund and for Environmental Justice Communities Trust Fund.”

Herrin’s bill has 23 co-sponsors, Comitta’s 12, all Democrats. Both remain in the Environmental Resources and Energy committees of the respective legislative chambers. On the other hand, Wolf has repeatedly vetoed Republican legislation that either would restrict or reject RGGI. Most recently, in January, it was a joint legislative resolution that turned thumbs down on a regulation by the state Environmental Quality Board to have Pennsylvania join RGGI.

Rementer also called attention to a petition filed Feb. 3 in Commonwealth Court by state Department of Environmental Protection Secretary Patrick J. McDonnell, in that role and his position as EQB chairperson, calling on officials of the Pennsylvania Legislative Reference Bureau and Pennsylvania Code and Bulletin to “discharge their mandatory, nondiscretionary duty to publish EQB’s duly-promulgated final-form rulemaking” that would implement Pennsylvania’s entry into RGGI.

RGGI now includes Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont and Virginia. But, Virginia Gov. Glenn Youngkin has signed an executive order to start the process of withdrawing that commonwealth from RGGI, while in North Carolina the process is under way that could bring that state into the compact.

“We look forward to engaging with the local community on alternative uses, including but not limited to the installation of renewable generating capacity, given the significant amount of infrastructure located on the site,” Wexler said. “Our community has benefited from the economic engine that is the Homer City Generating Station for over 50 years,” said state Sen. Joe Pittman, R-Indiana. “The operations of the facility have evolved over time and I fully believe there is an opportunity for continued productive economic use of the site beyond May of 2023.” Pittman acknowledged that what that use may be is an open question, but also said regulatory hurdles and taxes as proposed by RGGI make future use opportunities very difficult to explore.

A spokesman for Citizens for Pennsylvania’s Future, or PennFuture, said Homer City had been the only large coal-fired power plant in Pennsylvania that hadn’t announced plans to retire or convert to fracked-gas.“This change has been driven by a highly competitive energy market where dirty coal-fired units built in the 1960s just can’t compete,” said Rob Altenburg, PennFuture’s senior director for Energy and Climate. “This shift in the industry has been underway since well before Pennsylvania contemplated joining the Regional Greenhouse Gas Initiative, but RGGI is part of the solution. Not only does it require polluters to pay towards the damage they are causing, it also generates proceeds that can be invested to help workers and communities impacted by the failure of fossil fuel industries.”

Rep. Jim Struzzi, R-Indiana, whose legislative district includes the Homer City station, called this development unfortunate news. “It highlights why we have been fighting to stop Pennsylvania’s entry in (to RGGI),” Struzzi said.

“We will work with the power plant to minimize the impacts and hope for the best outcome for our county.” Equally, Pittman said, “I remain committed to working with my elected colleagues, the current ownership team of the plant and all potentially affected employees in figuring out the highest and best economic use of the Homer City Generating Station beyond May of 2023.”

Homer City’s announcement follows a more stringent set of wastewater guidelines issued last fall by the U.S. Environmental Protection Agency. It requires power plants to clean coal ash and toxic heavy metals such as mercury, arsenic and selenium from plant wastewater before it is dumped into streams and rivers.

In west-central Pennsylvania, the Keystone Generating Station in Plumcreek Township, Armstrong County, and the Conemaugh Generating Station in West Wheatfield Township, said they will stop using coal and retire all of their generating units by Dec. 31, 2028, according to regulatory notices obtained separately by The Associated Press. However, Homer City Generation LP told state regulators it plans to keep operating and abide by the new wastewater limits.

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