Mon Power issues RFPs addressing generation capacity, Bath plant sale

FirstEnergy (NYSE:FE) subsidiary Monongahela Power on Dec. 16 issued two requests for proposals (RFP). 

The first RFP seeks 1,300 MW of generation capacity and up to 100 MW of demand-response resources, which are temporary reductions of electrical usage by customers.

The second solicits bids for a possible sale of Mon Power’s ownership interest in the Bath County Pumped Storage Hydroelectric Generating Station located in Warm Springs, Virginia. Mon Power has an indirect 487-MW ownership interest in the pumped storage hydroelectric station, which consists of two large reservoirs and a powerhouse interconnected by tunnels.

Virginia Electric and Power, a subsidiary of Dominion Resources (NYSE:D) is the majority owner of the station and manages its operation. The entire Bath pumped storage plant includes multiple units and has a total generating capacity of more than 2,800 MW.

Mon Power has engaged a nationally recognized consultant, Charles River Associates, to assist in the preparation, administration and evaluation of the RFPs.  Proposals will be received and evaluated in early 2017.  Additional details regarding the RFP for generation capacity, including contact information, can be found at

The notice of intent with pre-qualification documents is due Dec. 23 on the capacity RFP. Proposals are due Feb. 3, 2017.

Information about bidding on Mon Power’s ownership interest of Bath can be found at

On Bath County, the notice of intent with pre-qualification documents is due Dec. 23. The proposals are due Feb. 17, 2017.

Updated energy usage forecasts show Mon Power will need additional capacity starting in 2017, with a steadily increasing shortfall expected to reach about 1,400 MW by 2027.

Rapid growth of the expanding Marcellus shale gas industry is a primary driver of load growth in West Virginia. A capacity shortfall was identified in the company’s Integrated Resource Plan (IRP) filed with the Public Service Commission of West Virginia (WV PSC) in 2015.

Mon Power wants to procure ownership of a dispatchable generation facility or facilities amounting to approximately 1,300 MW of Unforced Capacity (UCAP). The acquisition is expected to take place in 2017 following necessary regulatory approvals. Proposals are expected to be for the sale to Mon Power of 100% of the specified generation facility or facilities from which dispatchable output will be delivered. Proposed facilities should have no major operational limitations that reduce their ability to run for extended periods. Mon Power said it is willing to purchase a generation facility or facilities owned by multiple owners provided that the owners submit a joint proposal where full ownership of the facility or facilities is being offered.

For a new or planned generation facility to be considered, the bidder needs submit a copy of an executed pro-forma PJM Interconnection Service Agreement and Interconnection Construction Services Agreement, as well as a copy of a completed PJM Facilities Study and a PJM System Impact Study for the project for the proposed delivery point. Respondents submitting proposals for a new or planned generation facility also must submit a copy of a fully executed engineering, procurement and construction (EPC) contract.

Respondents need to state the nameplate capacity, net summer operating capacity, net winter operating capacity and the UCAP of the generation facility for the 2016/2017 PJM planning year. Respondents also should provide the expected UCAP for the PJM 2020/2021 Reliability Pricing Model (RPM) Base Residual Auction. Generation assets offered must have a minimum UCAP of 100 MW.

For proposals to sell an existing generation facility to Mon Power, the existing generating facility must have cleared in the RPM capacity auctions for 2018/2019 and 2019/2020 Delivery Years or be eligible to participate in the incremental RPM auctions for these specified delivery years. For new or planned generation facilities, Mon Power will accept generation that qualifies as a Capacity Performance resource(s) in the 2020/2021 Delivery Year; and in all delivery years thereafter.

Mon Power will seek regulatory approval from the West Virginia PSC and the Federal Energy Regulatory Commission (FERC) after a proposal or proposals are selected.

The sale of Mon Power’s ownership interest in the Bath facility is being considered because recent changes in the PJM Interconnection capacity market will subsequently diminish the cost-effectiveness of using the facility to provide generation and capacity revenue to customers.  Capacity is the commitment of generation or other resources to be available to provide electricity, particularly when demand surges during extreme cold snaps or heat waves.

If Mon Power identifies an acceptable buyer for its Bath ownership interest, it would seek regulatory approvals as necessary to complete the sale.

Mon Power supplies electricity to both its 385,500 customers and 137,000 Potomac Edison customers in the state’s Eastern Panhandle. Mon Power’s electric portfolio consists of 3,700 MW of capacity, including approximately 160 MW of non-utility generator (NUG) resources, over 2,000 miles of transmission lines at voltages ranging from 69 kilovolts (kV) to 500 kV, and more than 25,464 circuit miles of distribution lines at voltages ranging from 2.4 kV to 34.5 kV in West Virginia. Mon Power owns a mix of generating resources consisting of fossil-fuel plants and hydroelectric pumped storage. Additionally, Mon Power purchases certain capacity and energy from NUGs and PJM.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at