FERC okays transfer of half of Mitchell coal plant to Wheeling

With the matter still pending at the West Virginia Public Service Commission, the Federal Energy Regulatory Commission on June 2 approved a transfer of half (780 MW) of the Mitchell coal plant to the Wheeling Power unit of American Electric Power (NYSE: AEP).

At the end of 2013, due to a deregulation program in Ohio, AEP’s Ohio Power unit transferred its power plant assets, including all of Mitchell, to the non-regulated AEP Generation Resources. The other half of Mitchell has since been transferred to AEP’s Kentucky Power unit to make up for the impending closure of the coal-fired Big Sandy Unit 2 (800 MW).

On April 11, American Electric Power Service Corp., Wheeling Power and AEP Generation Resources applied with FERC for the transfer of the other half of Mitchell, which is located in northern West Virginia, to Wheeling. AEP is also seeking approval of this deal at the West Virginia PSC.

The situation is a bit complicated because the Virginia State Corporation Commission last year refused to grant the transfer of this half of Mitchell to AEP’s Appalachian Power unit. The West Virginia PSC shelved the companion application after the Virginia commission failed to approve it.

Now, AEP wants to transfer this half of the coal plant to Wheeling, which right now is only a wires company with no generation of its own. Things will get interesting if this buy succeeds, because the Virginia commission would eventually look at the Mitchell question again as part of a long-planned and long-delayed merger of Appalachian Power and Wheeling Power. But by then Wheeling’s ownership of half of Mitchell may be a fait accompli.

As part of the PSC proceeding, the AEP companies on May 30 filed certain facts about the Mitchell plant. They noted that the plant is currently undergoing a dry fly-ash conversion and landfill project to meet the requirements of the plant’s National Pollution Discharge Elimination System (NPDES) water discharge permit. These projects are also anticipated to position the plant for future compliance with the coal combustion residuals (CCR) and effluent limitation guideline (ELG) rules.

The CCR rule is anticipated to require the Mitchell plant to convert to a dry bottom ash handling system. The ELG rule is expected to require the addition of a biological wastewater treatment system at the Mitchell plant starting in approximately 2018, as well as re-line of the bottom ash pond in the 2017 through 2019 period.

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.