Calpine Corp.’s (NYSE: CPN) Deepwater Energy Center in New Jersey is currently scheduled to be retired in May 2014, while three other peakers in the same state are also due for retirement.
Calpine, in its Feb. 13 annual Form 10-K report, said that Deepwater is a steam cycle facility in New Jersey that has 158 MW of peaking capacity. The plant is located on the Delaware River in New Jersey. The original plant construction began in 1929. The two remaining operating units were constructed in the 1950s. Calpine acquired Deepwater in 2010 as part of its purchase of the Conectiv Energy assets.
The company said that in the case of three other New Jersey plants, also acquired in 2010 in the Conectiv deal, it has provided notice to PJM Interconnection that it plans to retire these units before commencement of the PJM Reliability Pricing Model 2015/2016 delivery year:
- Middle Energy Center, simple cycle, 77 MW peaking;
- Cedar Energy Center, simple cycle, 68 MW peaking; and
- Missouri Avenue Energy Center, simple cycle, 60 MW peaking.
The Form 10-K said the retirements are mainly due to a New Jersey air program. “New Jersey’s High Electric Demand Day (‘HEDD’) Rule limits NOx emissions from turbines and boilers. Beginning in 2015, Phase 2 of the HEDD Rule will require investments in emissions controls on some of our peaking power plants. We have provided notice to PJM that we plan to retire our 158 MW Deepwater Energy Center before the commencement of the PJM 2014/2015 delivery year and our 68 MW Cedar Energy Center, 60 MW Missouri Avenue Energy Center, and 77 MW Middle Energy Center before the commencement of the PJM 2015/2016 delivery year. In the event certain transmission upgrades are not completed as planned, PJM may require one or more of the plants to continue to operate for a period of time, but we would be entitled to full cost recovery.”
Calpine added about the HEDD program: “We plan to install emissions control equipment at our 73 MW Carll’s Corner Energy Center and 67 MW Mickleton Energy Center as these power plants cleared PJM’s 2015/2016 base residual auction. All six of our power plants impacted by the HEDD Rule will be fully depreciated by June 2015. We expect that the retirement of these power plants or installation of emissions controls will not have a material impact on our financial condition, results of operations or cash flows.”