Dynegy readies for Sept. 15 shutdown of Newton 2 coal unit in Illinois

The Illinois Power Generating subsidiary of Dynegy (NYSE: DYN) on Aug. 15 filed with the Federal Energy Regulatory Commission a revised Rate Schedule FERC No. 6 reflecting a reduction in the cost-based annual revenue requirement for Reactive Supply and Voltage Control from Generation Sources Service related to the upcoming retirement of the coal-fired Newton Unit 2 in Illinois.

Newton is interconnected to the transmission system of Ameren Illinois and located within the Midcontinent Independent System Operator (MISO) footprint.

IPG requested that the commission accept the Revised Rate Schedule for filing and expedited treatment and any necessary waivers of the commission’s regulations to permit an effective date of Sept. 15, 2016, to coincide with the suspension, and subsequent retirement, of Newton Unit 2.

On March 15, Illinois Power Marketing submitted to MISO an Attachment Y Notification of Potential Generation Resource/SCU Change of Status from the MISO Open Access Transmission, Energy and Operating Reserve Markets Tariff, pursuant to which MISO was notified of the proposed suspension of operations of Newton Unit 2 effective Sept. 15, 2016, with the unit resuming operations on Sept. 15, 2019. By letter dated May 18, MISO notified IPM that the suspension of Newton Unit 2 would not require that it be designated as a System Support Resource (SSR) unit as defined in the MISO Tariff.

On May 31, IPM submitted to MISO a second Attachment Y notification under which MISO was notified of the decommissioning and retirement of Newton Unit 2 effective Nov. 29, 2016. By letter dated Aug. 5, MISO notified IPM that the retirement of Newton Unit 2 would not require that it be designated as a SSR unit. Based on the Sept. 15 suspension of operations, IPG is submitting its Revised Rate Schedule. The Revised Rate Schedule reflects a reduction in the annual revenue requirement for Reactive Service by the portion of the revenue requirement attributable to Newton Unit 2.

Dynegy had announced May 3 that it plans to shut down multiple Illinois coal-fueled units after they once again failed to recover their basic operating costs in the most recent MISO capacity auction. Units 1 and 3 at the Baldwin Power Station in Baldwin, and Unit 2 at the Newton Power Station in Newton, are expected to shut down operations over the next year. If MISO determines the units aren’t needed for reliability, Dynegy said May 3 that it expects to shut down operations at Newton Unit 2 in September 2016, Baldwin Unit 1 in October 2016, and Baldwin Unit 3 in March 2017.

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.