Today’s move came after FirstEnergy announced on Wednesday it plans to close three nuclear power plants in Ohio and Pennsylvania by the year 2021 if it can’t sell them first.
Just hours after making the announcement, FirstEnergy’s FirstEnergy Solutions unit called on U.S. Energy Secretary Rick Perry, asking him to intervene – evoking little-used emergency powers to order PJM Interconnection, the regional power grid operator, to negotiate a contract for the utility that would compensate it for benefits, such as “reliability and jobs those units provide,” reports Reuters.
PJM has already rejected the order. “Nothing we have seen suggests there is any kind of emergency from these units retiring,” said Vincent Duane, senior vice president at PJM, calling the problem “fundamentally a corporate issue.”
And it may all come down to being a corporate issue. There has been speculation that FirstEnergy is headed toward bankruptcy. A spokesman at FirstEnergy Solutions declined to comment on the issue but directed attention to the filing the company made with the U.S. Energy Department earlier in the day.
The filing included a comment made by FirstEnergy Corp’s chief executive, Charles Jones, in February that he would be “shocked” if FirstEnergy Solutions did not file for some type of bankruptcy protection by the end of March, according to Reuters.
Three power plants slated for deactivation
In its announcement yesterday, FirstEnergy said the three plants slated for deactivation include:
Davis-Besse Nuclear Power Station (908 MW) in Oak Harbor, Ohio, in 2020
Beaver Valley Power Station (1,872 MW) in Shippingport, Pa., in 2021
Perry Nuclear Power Plant (1,268 MW) in Perry, Ohio, in 2021
The three plants have a total capacity of 4,048 megawatts (MW), with the Beaver Creek facility having the largest capacity. FirstEnergy cited weak power prices, insufficient results from recent capacity auctions, and weak demand forecasts as the reason for the decision to close the plants – which did not come lightly reports TribLive.
“Though the plants have taken aggressive measures to cut costs, the market challenges facing these units are beyond their control,” said Don Moul, president of FES Generation Companies and chief nuclear officer.
The Nuclear Regulatory Commission (NRC) has been notified verbally of the decision and this will be followed up with a mandatory written notification to the agency within 30-days, said the company.
Between the shale boom and the change-over to clean energy resources, operators of coal-fired and nuclear power plants have taken some hard lumps in recent years. Last Year, Energy Secretary Rick Perry tried putting through a plan to subsidize coal and nuclear for providing what is known as “base-load generation,” meaning those units that run 24/7.
However, U.S. Regulators shot that plan down in January, saying they would do a grid study. But as it is right now, many grid operators are already factoring in the reliability of their systems and the fuel resources available to generate electricity.
Murray Energy Corporation, the nation’s largest coal company, supplies coal to FirstEnergy, and they have been lobbying elected officials to keep the utility’s plants operating.
“As a result of FERC’s failure, critical power plants will close, thousands of American jobs will be lost, and the reliability, resiliency, and security of our electric power grids will be forever compromised,” Murray Energy said in a statement, referring to the Federal Energy Regulatory Commission’s rejection of Perry’s resiliency proposal.