Texas-based energy company Dynegy Inc. plans to shut down its Wood River Power Station, a coal-fired power plant located in Alton, by mid-2016.
"The decision to retire the Wood River facility is due to its uneconomic operation stemming from a poorly designed wholesale capacity market in Central and Southern Illinois that does not allow competitive generators to recover costs," the company said in a statement on Wednesday.
The Wood River facility is located in the Midcontinent Independent System Operator (MISO) capacity market, and the power plant has to compete with regulated utilities from neighboring states, which "receive higher guaranteed compensation from their respective state-regulated markets," Dynegy explained.
"Central and Southern Illinois market participants, on the other hand, operate in a state with a deregulated competitive framework and must rely on the MISO capacity auction for fair compensation, unlike their regulated counterparts," the company's statement added. "Mixing these two regulatory regimes together in the same capacity auction puts all generating units in Central and Southern Illinois at financial risk, regardless of fuel type, shifting jobs and the economic benefits of hosting generating plants from Central and Southern Illinois to neighboring states."
About 90 workers are employed at the Wood River power plant. Dynegy said it "will be developing plans to minimize the impact" on the workers and to "terminate operations in a safe and environmentally responsible manner." The company added that it "will work with all of the relevant state, local, and community stakeholders to address the impact of the retirement of Wood River."
Elizabeth Scrafford, an organizer with the Sierra Club's Beyond Coal campaign in Alton, issued this statement Wednesday upon news that Dynegy is phasing out its Wood River facility:
Today, the Sierra Club's Beyond Coal Campaign is focused on the workers at Dynegy's Wood River coal plant and their families and is committed to working in solidarity to maximize new opportunities for the skilled workforce at the plant. We recognize Dynegy's commitment to minimize worker impact by partnering with the Union that represents the large majority of these employees to identify opportunities for workers to transition to other plants in the Dynegy fleet and other efforts to help facilitate the transition for those who are unable to secure other roles. The Sierra Club continues to fight statewide for additional policies that will jump-start the state's energy economy to allow for new, family-sustaining jobs for the workers impacted by a rapidly changing energy market."
For over a year, the Sierra Club's Beyond Coal campaign and its partners in the Metro East area have been calling on community leaders to start planning for the inevitable transition of aging power plants like the Wood River coal plant. It is our hope that Dynegy's announcement today will catalyze an inclusive and all-encompassing stakeholder process to begin the necessary work of envisioning Alton's future without a coal plant, and to identify new opportunities for development and future use of the site. The Sierra Club stands ready to work with stakeholders to that end.