Eastern U.S. Braces for First Summer Without Coal Plants

Via The Washington Times:

The Eastern U.S. could be bracing for bigger summer electricity bills as power plant closures due to a host of federal emission regulations kick into high gear, according to energy market analysts.

Market analysts with Louisville, Ky., company Genscape confirmed this week that nearly eight gigawatts of primarily coal-fired power went dark as of Tuesday in the largest electricity market in the country, PJM Interconnection. That is enough electricity to power between 5.9 million-7.8 million homes.

PJM Interconnection is the grid operator that runs the electric delivery system across most of the densely populated areas of the eastern United States. The Genscape update on the power plant closures confirmed that the plants that went offline May 31-June 1 were critical to providing power to the system last summer when electric demand for cooling was at its peak.

With those plants now offline, analysts are waiting to see what happens, including a likely surge in electricity prices.

“Higher demand in addition to a thinner supply stack due to these retirements will likely lead to increased pricing particularly on those peak demand days,” Genscape market analyst Anne Williams told the Washington Examiner. Williams says demand is expected to be higher than last year, with higher temperatures forecasted for the summer compared to 2014.

A report published by Genscape ahead of Wednesday’s update acknowledged the potential for an upside swing in prices due to the plant closures.

The retirements are due primarily to the Environmental Protection Agency’s rules for controlling mercury and air pollutants from power plants that went into effect in April.

“Changing economic factors and recent developments in energy policies at both the state and federal level have precipitated a number of generator retirements across the country,” Williams said in a Wednesday blog post.

Genscape confirmed with PJM that 7.8 gigawatts of capacity was retired in the past few weeks following the Memorial Day weekend.

See the article.