Peoria Station

The consequences of the Environmental Protection Agency’s war on coal are becoming evident in central Illinois. First of all, the Chicago Tribune reported yesterday that Ameren Energy Corp wants to exit the power generation business in Illinois.

Three months after winning a five-year extension to meet environmental regulations for its Illinois coal plants, Ameren Corp. will walk away from them.

The reason given is that costs of upgrading these plants to comply with new EPA emissions standards is making Ameren’s Illinois plants unprofitable. Unfortunately, the article raises more questions than it answers. In fact, after a few paragraphs, it gets a rather confusing.

The company said its generation business will “more likely than not” sell one of more of its three natural gas-fired power plants — in Elgin, Ford and Jackson counties — which collectively have the capacity to produce 1,166 megawatts.

Okay, so we know the problem is with the coal-fired plants, but Ameren intends to sell “one or more” of its natural gas plants – even though natural gas is more “environmentally friendly” and is become much cheaper and more abundant thanks to hydraulic fracturing. Huh?

It did not say what it would do with its other generating assets, which include Illinois plants that primarily burn coal in Montgomery and Jasper counties as well as coal-fired power plants in Joppa, Canton and Bartonville.

Ameren operates two coal-fired power plants in the Peoria area: E. D. Edwards Station at Sommer (south of Bartonville) and Duck Creek Station near Canton. Considering how much Ameren has poured into these plants already, you have to ponder the logic of selling or closing them. But the article merely states that Ameren wants to “exit the power generation business in Illinois.” Maybe they can maintain ownership and lease the plants to other utilities?

Perhaps most alarming is the last paragraph:

The parent company for Midwest Generation, another coal plant owner in Illinois, filed for bankruptcy protection this week and is asking that Illinois regulators give the company a two-year “pause” as it attempts to tick down sulfur dioxide emissions at its power plants in time to meet state-mandated deadlines.

The issue isn’t “settled,” and the EPA’s stringent mercury emissions standards have plenty of critics. See William O’Keefe’s article here:

This blog’s concern is that power plant closures and cutbacks mean fewer coal trains. Fewer coal trains in the Peoria area significantly harms railroads and rail lines that are heavily depending on coal. These include the Illinois & Midland Railroad, BNSF’s Peoria Subdivision and Union Pacific’s Peoria Subdivision. Significantly reduced tonnage may endanger some lines’ viability, especially where there is little or no potential replacement business.

War on coal. Higher energy prices. Fewer jobs. You betcha.

- David P. Jordan