Dynegy Inc. plans to phase out coal-fueled units in Central and Southern Illinois, the company announced Tuesday.
Over the next year, the Texas-based energy company says it will shut down units one and three at the Baldwin Power Station and unit two at the Newton Power Station.
"The decision to shut down operations at the Baldwin and Newton units was made after they once again failed to recover their basic operating costs in the most recent MISO [Midcontinent Independent System Operator] capacity auction," the company said in a statement.
Dynegy citied similar reasons in deciding last November to retire its Alton-based Wood River Power Station in June.
The company said in a news release Tuesday, "Illinois policymakers must act now to prevent additional plant shutdowns and job losses."
"Disappointingly, rather than resolve the market design deficiencies, which has the added benefit of retaining Illinois jobs and economic benefits, the only response from Illinois officials to date occurred last year when the Attorney General's office filed a complaint claiming that the clearing capacity price received by Dynegy for less than 10 percent of the Company's megawatts in MISO Zone 4, that was comparable to prices in northern Illinois and did not even cover Dynegy's costs, was not just and reasonable. Dynegy has spent more than a year defending itself against this baseless claim," explained Dynegy CEO Robert Flexon.
He added: "Resolution of this issue in a way that serves Illinois as a whole can only be achieved with the immediate help and leadership of the Illinois state government for which we believe we have solutions, and we urgently need an audience. In the limited time left before closures occur, we are ready to work quickly with MISO, the state of Illinois, union leadership, and all stakeholders to rectify the situation and preserve the jobs and economic base in downstate Illinois, while continuing to provide safe, low cost, and reliable power to the region."
Howard Learner, executive director of the Environmental Law and Policy Center, issued a response to Dynegy's call for state action.
Dynegy's management made a business decision to shut down old coal plants that are not economically competitive in the power market. Dynegy appears to now be asking Illinois legislators to force consumers to pay higher utility bills to subsidize Dynegy's old, uncompetitive power plants. That's just not fair. Illinois legislators should advance policies to support investment in the new clean energy technologies that keep electricity costs affordable while creating new jobs and spurring economic growth.
Illinois has a surplus of old nuclear and coal plant supply while demand is declining due to smart energy efficiency that saves money for businesses at home. Natural gas and new wind power are outcompeting the old coal and nuclear plants, and they are saving consumers' money. Illinois policymakers should not force consumers to pay higher utility rates to subsidize old plants they've already paid for.
The Illinois chapter of the Sierra Club also weighed in on issue, calling for state policies to boost the local clean energy economy. The group's director, Jack Darin, released this statement:
Dynegy's decision to phase out units at these coal-fired power plants is a signal of the profound shift that's happening right now in America's energy landscape. It is essential that we invest in the livelihoods of workers and communities historically dependent on coal, and work to maximize opportunities for the skilled workforce at the plants impacted by Dynegy's announcement.
Clean energy technology is growing every year in Illinois, but we must act now to get energy policy right to ensure that every Illinois community can thrive in the clean energy economy. The Sierra Club will continue to fight statewide for policies like the Illinois Clean Jobs Bill 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.
Workers and communities need the long-term stability that the clean energy economy can bring when we update our policies to make Illinois a national leader in technologies of the future.