One day after going out with a coal solicitation for Alabama Power’s Miller plant, Southern Company Services on April 5 issued a solicitation for long-term coal requirements for Georgia Power’s Wansley, Hammond and Yates plants.
The bids are due April 18, with the bids to remain valid for 30 days thereafter so SCS can evaluate them. SCS, a unit of Southern Co. (NYSE: SO), is acting as agent for Georgia Power and other Wansley co-owners. All three power plants are served by the Norfolk Southern (NS) railroad.
Georgia Power requests that all interested Illinois Basin, Northern Appalachia, Central Appalachia, Southern Appalachia, import, and western bituminous coal suppliers submit bids under this solicitation. About the only major coal-producing region that leaves out is the Powder River Basin. The contract term is January 2013-December 2014. The quantity is up to 500,000 tons per year.
Price should be quoted in U.S. dollars per ton f.o.b. railcar at the proposed loading facility and as a fixed price for year one with specified annual escalation (if any) for the following years. All import coal proposals are to be quoted CIF in either handymax-sized or panamax-sized vessels or f.o.b. railcar delivered into the Shipyard River Terminal in South Carolina and/or another NS-rail-served port. The transportation services costs from the mine to the import terminal must be shown separately from the coal f.o.b. mine cost in the bid pricing.
If delivered by rail, price should be quoted f.o.b. railcar at the proposed loading facility. Shipment size shall be 80-110 cars. Shipments must be loaded in rapid discharge cars.
The coal specs vary by plant.
- For Hammond, the desired as-received specs include: 12,500 to 13,000 Btu/lb (12,000 minimum); 8% total moisture (12% maximum); 8% ash (13% maximum); 1.5%-2% sulfur (2.8% maximum); size 3” x 0”; and grindability, HGI 42 (38 minimum).
- For Wansley and Yates, the as-received specs include: 11,300 to 13,000 Btu/lb (11,000 minimum); 8% moisture (15% maximum); 8% ash (16% maximum); 0.5% to 2.5% sulfur (2.8% maximum); size 3″ x 0″; and grindability 42 (38 minimum).
“Georgia Power may accept sulfur up to 2.8%; however, appropriate economic consideration must be given for sulfur,” the solicitation noted. “Seller must specify and guarantee the monthly average sulfur content in addition to the range of expected quality in order for our evaluation process to accurately determine cost involved in the use of such coal.”
The SCS website shows that Wansley has 1,730 MW of capacity and usually burns about 4.4 million tons of coal per year, Hammond is 800 MW with a typical burn of 1.6 million tons per year, and Yates is 1,250 MW and has 2.2 million tons per year of burn.