The Monongahela Power and Potomac Edison units of FirstEnergy (NYSE: FE) on Dec. 30 filed with the West Virginia Public Service Commission their 2015 Integrated Resource Plan, with that plan’s Long Term Load Forecast indicating a capacity shortfall starting in 2016, with the shortfall exceeding 700 MW by 2020 and extending to over 850 MW by 2027.
Mon Power and Potomac Edison examined several alternatives to address the capacity shortfall, including purchasing power from the PJM Interconnection market, building new capacity, purchasing power from other parties, co-firing existing coal fired generation using natural gas, and acquiring existing generating facilities.
The recommended set of alternatives from the two utilities has two components:
Purchase or acquire approximately 850 MW of additional capacity based upon a levelized cost analysis of resource options – The first part of the recommendation is to address the long-term capacity shortfall through the acquisition of additional resources. Because of the significant cost necessary for such a transaction, which could include negotiations with sellers, the specific asset or assets cannot be determined at this time. The companies are continuing their review and expect to seek the commission’s approval in a separate docket for any future specific proposed transaction(s) which are selected.
Retrofit some or all of Mon Power’s existing coal-fired units to implement co-firing with up to 30% natural gas burn – To the extent that future environmental regulations or other risks reduce the ability of Mon Power’s existing coal plants to be used to meet energy and capacity needs, the shortfall identified in this analysis would be even larger. There thus is a considerable benefit to preserving these plants, if it can be done in a cost-effective manner. Co-firing provides a dual-fuel capability that allows the units at the Harrison and Fort Martin plants to take advantage of the fuel source that provides the most benefits on a continuous basis. This would include both environmental and economic benefits. Co-firing would reduce emissions due to a reduction in coal consumption. Co-firing capability also improves capacity output by adding natural gas if coal supplies are diminished or when coal quality is reduced. It also provides for the flexibility to make real-time decisions regarding cheapest fuel type used. While it is expected that some or all of Mon Power’s existing units are capable of such an upgrade, more engineering is needed to evaluate the level of co-firing, cost, feasibility, and timing of each unit.
Mon Power’s current generation portfolio is comprised of 3,689 MW of Installed Capacity. Installed Capacity (ICAP) is defined as the summer net dependable capability (NDC) of a unit. Over 3,000 MW of the ICAP value comes from two supercritical coal plants – Fort Martin (100% ownership) and Harrison (100% ownership). Mon Power has partial ownership of the Bath County Pumped Storage Project (16.25% ownership), which is a pumped storage hydro plant accounting for 488 MW. Mon Power also has Purchase Power Agreements with three facilities – the coal-fired Morgantown Energy Associates’ WVU Project, the coal-fired American Bituminous Power Partners LP’s Grant Town Project, and the City of New Martinsville’s Hannibal Project, a hydro facility. These projects make up the remainder of Mon Power’s ICAP value (about 150 MW).
- Fort Martin is a supercritical coal plant located in Maidsville, West Virginia, and was built in 1967. Fort Martin has a current ICAP generating capacity of 1,098 MW. Fort Martin has two turbine generating units. Unit 1 came on line in 1967 and has an ICAP (PJM) capacity of 552 MW. Unit 2 came on line in 1968 and has an ICAP (PJM) capacity of 546 MW. Coal for the units is delivered via barges on the Monongahela River. Both units have Low NOx Burners (LNB) and Selective Noncatalytic Reduction (SNCR) NOx controls. Each of the units has Wet Flue Gas Desulfurization (WFGD) SOX controls. Both units also use an Electrostatic Precipitator (ESP) to control particulate matter.
- Harrison is a supercritical coal plant located in Haywood, West Virginia, and was built in 1972. Harrison has an ICAP (PJM) value of 1,954 MW. Harrison has three turbine generating units. Unit 1 came on line in 1972. Unit 2 came on line in 1973. Unit 3 came on line in 1974. Coal for the units is delivered by a minemouth conveyor belt or by trucks. All three units have Selective Catalytic Reduction (SCR) NOx controls and WFGD SOX controls. Each of the units also uses ESP to control particulates.
Notable is that Mon Power earlier this decade shut the old Rivesville, Albright and Willow Island coal plants in West Virginia, leaving it currently with Fort Martin and Harrison plants as its only owned coal capacity still in operation.
Energy production from the contracted PURPA units is offered into the PJM energy market on a day-ahead basis, while capacity is offered into the PJM RPM market.
- Morgantown Energy Associates’ WVU Project is a coal and waste coal (or gob) fired power station located in Morgantown, West Virginia. The plant receives its QF status by providing steam to West Virginia University, and also by burning waste coal (gob), supplying electricity to Mon Power under a 50-MW long-term purchase power agreement that currently expires in 2027.
- The American Bituminous Power Partners Grant Town Power Plant is a coal-fired station owned and operated by Grant Town Holdings Corp. near Grant Town, West Virginia. Like the WVU Project, Grant Town also burns waste coal for its QF status, and supplies electricity to Mon Power under an 80-MW long-term purchase power agreement that currently expires in 2036. This resource plan assumes the continued operation of the Grant Town Project through the end of its contract.
- The City of New Martinsville’s Hannibal Hydroelectric Plant is located on the left descending bank of the Ohio River at New Martinsville, West Virginia, abutted to the Hannibal Lock and Dam. The plant is owned and operated by the City of New Martinsville, and sells the output of the plant to Mon Power under a long-term purchase power agreement that expires in 2034. New Martinsville Hydro has an ICAP value of 19 MW.
The utilities noted that nuclear power was considered in some scenarios under this resource plan, but ultimately was not recommended in the plan because: it was not the most cost-effective alternative; and there is a limited ban on the construction of nuclear power plants in the state of West Virginia.