FirstEnergy Corp. is seeking to sell or shut down its 136 megawatt Bay Shore plant six miles east of Toledo and also will close a significant portion of its W.H. Sammis plant, its largest coal-fired electric generator that sits along the Ohio River in Stratton.
The Akron utility announced the upcoming changes Friday.
FirstEnergy said it will sell or deactivate Bay Shore Unit 1 by Oct. 1, 2020. The plant, on 571 acres along Maumee Bay, primarily burns coal and also has a small, 16 megawatt oil-fired peaking unit.
It also will deactivate, by May 31, 2020, units 1 through 4 at Sammis that now generate 720 megawatts out of the facility’s capacity of 2,210 megawatts. The four units were built from 1959 through 1962, making them the plant’s oldest, and most recently are being used to meet peak demand, not baseload demand, the utility said.
Sammis takes up 187 acres and fronts along the Ohio River.
FirstEnergy said it will take impairment charges of $150 million for the Bay Shore closure or sale and impairment charges of $497 million for Sammis.
The company did not give specific reasons for the sale or closures other than saying in a letter to investors that “the business environment for the [Competitive Energy Services] segment continues to be challenged by the current market conditions.”
FirstEnergy spokeswoman Jennifer Young said the coal units the utility will close down are uneconomical and no longer needed. The units will continue to make electricity into 2020, she said.
“We continue to face challenging market conditions,” she said. That includes pricing pressures as well as lower demand for electricity, she said.
The units being closed down meet environmental standards, Young said.
FirstEnergy does not expect job losses related to the upcoming Sammis unit shutdowns other than through normal attrition, Young said. The plant now has 368 people.
The Bay Shore plant has 78 employees. If FirstEnergy does not find a buyer to keep the facility running past 2020, it expects some retirements while other employees will be able to work elsewhere at FirstEnergy, Young said.
The Sierra Club applauded the announcement and issued a statement, noting FirstEnergy said it is no longer economically viable to operate the facilities.
“The majority of these units have been front and center in an ongoing two-year fight before the Ohio Public Utilities Commission where FirstEnergy has been trying to secure subsidies from its customers that could be used to keep these aging and ailing coal units open,” the environmental group said.
“Today’s announcement brings the total megawatts of coal to retire or announced to retire in Ohio since 2010 to 10,093 [megawatts], more than any other state, and 9.5 percent of the coal to retire or announced to retire nationally,” the Sierra Club said. “Coupled with the 1.5 gigawatts of coal generation announced to retire as part of a Sierra Club and AEP settlement in December of 2015, coal plants announced this year to retire in Ohio emitted 10 million metric tons of carbon dioxide and 41 million pounds of sulfur dioxide a year based on 2009 emissions.
“This announcement is yet another major development in the two-year public and legal debate with FirstEnergy, and creates a pivotal opportunity for Ohio to join the national clean energy trend and create more manufacturing jobs in making clean energy component parts,” the Sierra Club said. “FirstEnergy has taken the first step by announcing these retirements, and can play a major role in the evolving energy market.”
Company executives said they will discuss the power plant issues during an earnings conference call scheduled for 10 a.m. July 29. FirstEnergy releases second quarter earnings after the market closes on July 28.
Nationally, cheaper and cleaner natural gas produced primarily by fracking is increasingly being used to produce electricity, mainly at the expense of coal, according to federal figures.
Shares of FirstEnergy were up 53 cents, or 1.5 percent, to $36.49 as of 3:32 p.m.
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FirstEnergy closing Bay Shore, Sammis coal-fired units
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