AEP seeks bids on Powder River Basin coal for unnamed plants

American Electric Power (NYSE: AEP), which went out for bids May 18 on Northern and Central Appalachia coals, said May 24 that it is now seeking offers for the supply of Powder River Basin (PRB) coal to one or more of its generating stations.

AEP said May 18 that it is seeking offers for the supply of eastern coal, delivered by barge, to one or more of its generating stations. AEP in that solicitation is seeking proposals for up to 2 million tons of Northern Appalachia coal per year, beginning as early as January 2013 and ending as late as December 2017. It is also looking for up to 25,000 tons of Central Appalachia coal per month, beginning in January 2013 and ending in December 2013. Proposal packages must be received by AEP no later than 5 p.m. on May 31.

Under the May 24 solicitation, AEP is seeking spot-coal delivery proposals for: up to 2 million tons of PRB coal beginning Jan. 1, 2013, for a period of one year, delivered by rail; and/or up to 2 million tons of PRB coal beginning Jan. 1, 2014, for a period of one year, delivered by rail. AEP said it is open to alternative pricing structures or other innovative, value-added concepts, and proposals with alternative terms will be accepted. Accepted bids will be at AEP’s discretion. Proposal packages must be received by AEP no later than 5 p.m., June 1.

The bid package from American Electric Power Service Corp. lays out two sets of coal quality specs. Spec A is 8,800 Btu/lb, 29% moisture, 5.5% ash and 0.8 lbs/mmBtu of SO2. The 8,800-Btu coals from the PRB are basically out of three mines at the southern end of the Wyoming PRB: the Antelope mine of Cloud Peak Energy (NYSE: CLD), the North Antelope Rochelle mine of Peabody Energy (NYSE: ACI) and the Black Thunder mine of Arch Coal (NYSE: ACI). The other set of bid specs is 8,400 Btu/lb, 31% moisture, 5.5% ash and 0.8 lbs/mmBtu of SO2. That coal is out of a set of mines a bit further north from the three 8,800-Btu mines.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.