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Colstrip coal plant operator shuts 2 of 4 units, aims to avoid major layoffs

Two coal-fired steam turbines operating since the mid-1970s at the 2,094-MW Colstrip power plant in Montana were shut down Jan. 5, according to plant co-owner and operator Talen Energy Corp.

The closures came nearly two-and-a-half years earlier than the legally mandated deadline to shut down units 1 and 2 imposed by a settlement agreement reached between environmental groups and the six owners of Colstrip: Talen Energy subsidiary Talen Montana LLC, Puget Sound Energy Inc., Avista Corp., NorthWestern Corp., PacifiCorp and Portland General Electric Co.

Talen and Puget Sound Energy each own a 50% interest in units 1 and 2. NorthWestern is buying Puget Sound's 25% interest in unit 4. Avista will remove its 15% ownership interests in units 3 and 4 from its rate base by the end of 2025.

In June 2019, Talen Montana President Dale Lebsack cited financial pressures for the early closures. Units 1 and 2, which had been operating since November 1975 and August 1976, respectively, in Montana's Rosebud County, had a combined nameplate capacity of 715 MW.

"It's going to be interesting when we lose [about] 700 total megawatts of baseload power," Montana State Sen. Duane Ankney, a Republican who represents District 20, which includes the town of Colstrip, said in an interview Jan. 6. "We've got good years, and there's a lot of hydro — that's going to help — but taking 700 MW off the grid in the West ... it's going to be interesting to see how this all plays out."

Talen Energy spokesperson Taryne Williams said Jan. 6 that no employees have been terminated or laid off related to the unit closures and that it will take several months for workers to complete decommissioning activities.

"Talen Montana aims to avoid a significant layoff of Colstrip employees and is committed to doing what is right by our employees," Williams said, adding that the company is still developing an employee transition plan.

Legislator worries about impact on mine

All of the Colstrip plant's coal comes from Westmoreland Mining Holdings LLC's Rosebud mine, south of the town of Colstrip in southeastern Montana. The plant is the mine's primary customer, and Ankney said he worries about the impact of the plant's reduction in operations on the mine's ongoing operations.

"There really hasn't been any numbers out yet from the coal company that mines the coal or the power plant as to what impact this is going to have on their workers," said Ankney, who held coal mining supervisory positions in Montana for decades before turning to politics.

"You take 29% of the production away [at Colstrip], you don't like to think about it but there are people who are going to lose their jobs over this, and they won't be staying in the area because there is no jobs even comparable to this in the area," Ankney continued, adding that those workers may have to move out of the state to find comparable work.

In December 2019, Westmoreland signed a new six-year coal supply agreement to provide coal from the Rosebud mine to Colstrip units 3 and 4 through the end of 2025.

Ankney said that he has traveled to Washington, D.C., in recent years to visit with officials and advisers at the U.S. Department of Energy and the White House to discuss his concerns about shutting the Colstrip units. He said he has been told by those officials that the situation is going to get worse before it gets better.