The Kansas City Power & Light (KCP&L) unit of Great Plains Energy (NYSE: GXP) plans to partially back out coal from its fuel mix to meet clean-air needs, said the utility in an integrated resource plan filed on April 1 at the Missouri Public Service Commission.
KCP&L noted that it owns and operates a diverse generating portfolio and Power Purchase Agreements (PPA) to meet customer energy requirements. In June 2014, Great Plains Energy (GPE) signed a contract for a Power Purchase Agreement with EDF Energies for the output of a 150-MW wind farm named Slate Creek, located in Sumner and Cowley counties, Kansas. This new wind facility is expected to be on-line by the end of 2015, and at this time has been assigned to KCP&L.
Based in part upon current Missouri Renewable Portfolio Standard (RPS) requirements, the Preferred Plan includes 10 MW of solar additions and 650 MW of wind additions over the 20-year planning period. Some 3 MW of solar resource additions are expected to consist of Commercial and Industrial rooftop installations owned by KCP&L. The 350 MW of wind additions are from power purchase agreements (PPA) executed in 2013 and 2014. Some 300 MW of wind additions are planned to be in service in 2017.
The Preferred Plan also reflects ceasing to burn coal at Montrose Unit 1 in 2016 and at Montrose Units 2 and 3 in 2021. The environmental drivers that contributed to the discontinued coal use at the Montrose units included the federal Mercury and Air Toxics Standards, Ozone National Ambient Air Quality Standards (NAAQS), PM NAAQS, Clean Water Act Section 316(a) and (b), Effluent Guidelines, Coal Combustion Residuals Rule, and Clean Power Plan.
The Preferred Plan was not the lowest cost plan from a Net Present Value of Revenue Requirement (NPVRR) perspective for KCP&L on a stand-alone planning basis. Alternative Resource Plan KCCCA had the lowest expected NPVRR of all modeled KCP&L plans. This plan is the same as the Preferred Plan except KCP&L would cease to burn coal in Montrose 2 and 3 starting in 2021 as opposed to 2019.
The Preferred Plan is based upon resource planning in tandem with KCP&L Greater Missouri Operations Co. (GMO), another subsidiary of Great Plains Energy, and provides benefit to Missouri retail customers by planning on a joint basis. The joint KCP&L/GMO plan that includes keeping Montrose 2 and 3 in service as coal resources until 2021 is lower cost for Missouri electric customers than ceasing coal use in 2019.
Based on the 2015 Preferred Plan, limited environmental retrofits are anticipated to be required for Montrose Units 2 and 3 prior to cease burning coal in 2021. These retrofits are required to operate the units through year 2020. Those projects for the two units include activated carbon injection systems and electrostatic precipitator upgrades. Other projects anticipated to begin within the three-year implementation period are Hawthorn 5 Cooling Tower and Spray Dry Absorber water reduction, Iatan 1 Cooling Tower, and La Cygne 2 Submerged Flight Conveyer.
KCP&L is an integrated, mid-sized electric utility serving the metropolitan region surrounding the Kansas City, Missouri, metropolitan area including customers in Kansas and Missouri.