Decision to halt scrubber plan for KY plant could affect use of - WOWK 13 Charleston, Huntington WV News, Weather, Sports

Decision to halt scrubber plan for KY plant could affect use of WV coal

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A Kentucky power plant that burns almost 1 million tons of West Virginia coal per year might not install scrubbers after all.

Last week, Kentucky Power, an operating unit of American Electric Power, asked the Kentucky Public Service Commission for permission to withdraw its request for a 30 percent rate increase to pay the cost of installing a scrubber on the Big Sandy power plant near Louisa, Ky. The request was granted without prejudice, meaning the company can refile it later.

But for now, the question is what happens to Big Sandy when federal regulations on air quality kick in on Jan. 1, 2016.

The Big Sandy plant is on the Big Sandy River opposite the Wayne County, W.Va., community of Fort Gay. About 140 people work on site. The plant has two units — a 278-megawatt one that went into service in 1963 and a larger one that went into service in 1969. The larger unit generates about 800 megawatts of power — the lower limit of what AEP CEO Nick Akin has said is probably the lower limit for being able to support the investment of a scrubber.

Last year the plant burned about 2.6 millions tons of coal — about 70 rail cars per day on average. About 955,000 tons came from mines in five counties in West Virginia: Boone, Logan, Raleigh, Wayne and Webster.

Last year AEP announced it would take the smaller unit at Big Sandy out of service and replace the larger one with a gas-burning unit so the plant could meet air quality standards scheduled to take effect in early 2016. Last December, after AEP had had conversations with state officials, it announced it would instead apply for the rate increase so it could install a scrubber and continue burning eastern Kentucky coal.

Ronn Robinson, corporate communications manager for Kentucky Power, said the company is examining a variety of options as it determines what to do with Big Sandy. It could reverse course again and apply for a rate increase to build a scrubber. It could go back to its original plan and replace the coal-burning units with a gas unit. Or it could close Big Sandy and get power elsewhere.

"We want to re-evaluate our options," he said.

The company expects sufficient power to be available elsewhere in early 2016 if the plant must be shut down, Robinson said.

As for Big Sandy's immediate future, "it will continue to operate until it no longer complies with EPA rules and regulations," he said.

AEP's request for a 30 percent rate increase was opposed by several parties. The Kentucky attorney general's office, which represents consumers in rate requests before the state's PSC, opposed it. The Sierra Club and other groups opposed the scrubber plan on environmental grounds.