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New bill seeks tax credits for coal plants; Kentucky Power to sell coal surplus


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New bill seeks tax credits for coal plants; Kentucky Power to sell coal surplus

New US House bill seeks tax credits for existing coal plants

A new bill in the U.S. House of Representatives would provide a temporary tax credit for existing coal-fired power plants, with the goal of slowing a rising tide of retirements for generating units running on the fuel.

The legislation comes after the Federal Energy Regulatory Commission rejected a proposed rule from the U.S. Department of Energy that requested full cost recovery for certain coal-fired and nuclear plants in wholesale markets to bolster grid reliability. FERC dismissed the DOE's request, saying the department had not shown the need for such a rule, but coal power supporters have pursued other avenues for protecting the existing fleet.

PSC authorizes Kentucky Power to sell coal surplus at W.Va. plant

The Kentucky Public Service Commission authorized Kentucky Power Co. to sell up to 200,000 tons of its coal surplus scheduled for delivery to one of its plants and to pass along the resulting reduced fuel costs to customers.

The coal was scheduled for delivery in 2018 to the 1,560-MW Mitchell plant, located in Moundsville, W.Va., and co-owned by Wheeling Power Co. Both are subsidiaries of American Electric Power Co. Inc.

Kentucky Power said proceeds from the transaction would be reflected on customer bills through fuel adjustment costs.

FirstEnergy settles coal contract dispute with Tunnel Ridge

A FirstEnergy Corp. subsidiary will pay $93 million to Tunnel Ridge LLC to settle their dispute over a dropped coal supply contract that was to run through 2020. The Alliance Resource Partners LP subsidiary on March 15 filed a request with the Court of Common Pleas of Allegheny County, Pa., to settle, discontinue and satisfy its lawsuit against Allegheny Energy Supply Co. and several affiliates.

Tunnel Ridge sued Allegheny Energy in 2015 after accusing the FirstEnergy subsidiary of breaching a long-term contract signed in 2008. Tunnel Ridge claimed Allegheny Energy notified the coal supplier in August 2014 that it would refuse to accept any more shipments under the supply contract, citing force majeure provisions in the agreement including the U.S. Environmental Protection Agency's implementation of the Mercury and Air Toxics Standards rule.

Lawmakers grill Zinke on offshore drilling plans, energy focus at House hearing

During a March 15 congressional hearing, Rep. Jimmy Gomez, D-Calif. asked Interior Secretary Ryan Zinke about the logic behind some energy-related items in the Trump administration's fiscal-year 2019 budget request.

"The coal budget of the [U.S.] Bureau of Land Management has increased by 80%. However, according to Bloomberg and other sources, the coal production in the United States is going through a downward trend even under President Trump," Gomez said, contrasting that with proposed cuts to renewable energy programs. "Right now it definitely seems like one source is being promoted and given more funding than the other energy sources."

Zinke said the coal budget includes costs for leasing, inspection and clearing up a backlog of permitting.

Coal's necessity to US electricity grid a priority to some, a myth to others

A push to support baseload power resources, including coal-fired plants, continues, though some experts say the term is outdated for a number of reasons including trends driving utilities away from running coal plants at full power.

Advocates for the coal industry insist coal plants are necessary for a reliable grid and that ongoing retirements threaten the U.S. power system. As coal plant owners seek money to keep assets running, opponents of such policies say the market should be allowed to push those coal plants off a system they believe will be fine without them.