Vistra Energy Corp. subsidiary Luminant Generation Co. LLC will retire its 1,800-MW Monticello coal-fired power plant in Titus County, Texas, by January 2018.
"[T]he market's unprecedented low power price environment has profoundly impacted its operating revenues and no longer supports continued investment,"Vistra Energy President and CEO Curt Morgan said in an Oct. 6 statement. In March, a UBS report listed the Monticello facility among potential retirements in the Electric Reliability Council of Texas.
The company has notified ERCOT of the retirement, which would trigger a 60-day review to determine whether the three-unit facility is needed for reliability. If these units are not needed, Luminant expects to stop plant operations Jan. 4, 2018.
Monticello went online in 1974 and has an operating capacity of 1,955 MW, according to SNL Energy data. In December 2016, the U.S. Environmental Protection Agency listed Monticello among plants that needed to upgrade or install scrubbers to meet the regional haze rule for sulfur dioxide.
Luminant said it will take the necessary steps to decommission the facility and will continue ongoing reclamation work at the plant's mines, which ceased active operations in spring 2016.
According to S&P Global Market Intelligence data, the plant gets most of its coal from Peabody Energy Corp.'s Rawhide Mine in Campbell County, Wyo.
Vistra expects to record a one-time charge of $20 million to $25 million in the third quarter, including employee-related severance costs and noncash charges for materials inventory and the acceleration of Luminant's mining reclamation obligations. The retirement will impact approximately 200 employees.
"This was a difficult decision made after a year of careful analysis," Morgan said. "Luminant will be coordinating with civic leadership to prepare for the impacts of the transition."