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SWEPCO, Cleco eye 2021 retirement of Dolet Hills coal plant in Louisiana

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SWEPCO, Cleco eye 2021 retirement of Dolet Hills coal plant in Louisiana

Cleco Power LLC and Southwestern Electric Power Co. could shut down the 642.5-MW Dolet Hills lignite-fired coal plant in Louisiana before the end of 2021, or about five years ahead of a previous plan, the utilities wrote in recent federal filings.

In a May 6 Form 10-Q filing with the U.S. Securities and Exchange Commission, American Electric Power Co. Inc. subsidiary Southwestern Electric Power, or SWEPCO, indicated management has "revised the useful life of the Dolet Hills Power Station to September 2021 based on the remaining estimated fuel supply available for continued seasonal operation."

SWEPCO owns about a 40% stake in the De Soto County, La., coal plant and previously agreed to retire the power plant by the end of 2026 as part of a settlement agreement approved by the Arkansas Public Service Commission. SWEPCO reached the agreement with the Sierra Club and other intervenors in its electric rate case.

Cleco Power owns a 50% interest in Dolet Hills and operates the plant, which was brought online in April 1986, according to S&P Global Market Intelligence data. Cleco Power is a subsidiary of Cleco Partners LP and Cleco Corporate Holdings LLC.

In a Form 10-Q filed May 12, Cleco Power wrote that in April, the utility "announced its intent to seek regulatory approval to retire the Dolet Hills Power Station at the end of 2021, subject to recovery mechanisms."

"Cleco Power intends to seek regulatory approval to retire the Dolet Hills Power Station in Mansfield and the nearby mine that supplies the plant with coal," Cleco spokesperson Jennifer Cahill wrote in a May 13 email. "The closing dates for the power station and mine will be subject to discussions with stakeholders, including the Louisiana Public Service Commission and regional transmission organizations."

SWEPCO subsidiary Dolet Hills Lignite Co., or DHLC, "provides 100% of the fuel supply" to the power plant.

"In March 2020, it was determined that DHLC would not proceed developing additional mining areas for future lignite extraction and management notified a substantial portion of its workforce that employment will permanently end in June 2020," SWEPCO wrote. "Based on these actions, management has revised the estimated useful life of many of DHLC's assets to June 2020 to coincide with the date at which extraction is expected to be discontinued."

SWEPCO said its share of the net investment in the Dolet Hills Power Station is $151 million, which the utility expects to recover through its base rates.

Cleco Power, meanwhile, said it "has the ability to secure alternative fuel sources and expects to have sufficient lignite fuel available to continue seasonal operations of the Dolet Hills Power Station through at least the 2020 and 2021 seasonal operations periods."