Reuters reported on Friday that newly proposed EPA rules could shut down 13,000 megawatts of coal fired power generation, boost prices, and threaten the reliability of the electric grid. The rules could force plants to spend billions to retrofit their plants or to replace them!
The bearer of this bad news is power grid operator Midwest Independent System Operator (MISO). More than half of MISO’s capacity consists of coal-fired units. It operate the grid in parts of 12 states and Manitoba, Canada.
MISO operators may have to spend $33 billion to replace 62,000 megawatts out of the grid’s 70,000 megawatts of coal-fired plants.
Clair Moeller, vice president of transmission asset management says the EPA deadline of 2014-2015 is too short for MISO to make the necessary changes. “That is not enough time. It takes three or four years to retrofit or replace a power plant. We are worried about the nightmare of 62,000 MW going out at the same time.”
According to Reuters:
Just under 10,000 MW of coal generation is already compliant with the proposed EPA rules, Moeller said, noting that about 28,000 MW will require fabric air filters, called bag houses, which cost about $150 per kilowatt, and another 21,000 MW will require scrubbers, which remove sulfur and other pollutants, at an estimated cost of about $480 per kilowatt.
The remaining 13,000 MW could retire, Moeller said, because it would likely cost more to upgrade those units to make them compliant with the proposed regulations than to build new natural gas-fired power plants.
But the new gas plants will need a steady supply of fuel.
Moeller said the MISO was investigating whether there was enough capacity on the natural gas pipelines to fuel the expected new gas-fired plants.
“The gas pipeline system in the Midwest was built for winter heating use. We will likely need to expand the capacity of the pipelines if we plan to use more gas to run a lot more gas plants in the winter,” Moeller said.