East Kentucky Power Cooperative warned the US Environmental Protection Agency that its proposed Clean Power Plan could force the co-op to either close or sharply curtail two coal-fired generating units it spent nearly $1 billion to build in the past decade.

The generation and transmission co-op, one of the largest in the country, has invested nearly $1.5 billion in recent years to build the Gilbert No. 3 and Spurlock No. 4 units, totaling about 550 MW of capacity, and to retrofit older coal units with more modern pollution controls, Anthony Campbell, the co-op’s president and CEO said in comments submitted to EPA Monday.

Gilbert-3 and Spurlock-4, both equipped with circulating fluidized bed technology, are located at the 1,270-MW Spurlock plant near Maysville in Mason County. East Kentucky owns 1,882 MW of coal-fired capacity and burns about 4.5 million st/year of Illinois Basin and Central Appalachian coal.

East Kentucky spokesman Nick Comer said in an interview Tuesday that the co-op is concerned EPA’s carbon-dioxide-reduction plan could result in the idling of the two newer coal units. Or, he said, it could require East Kentucky to “back them down and operate them at a fraction of their capacity.”

Gilbert-3 and Spurlock-4 “are baseload units and we assume they’re going to run pretty close to capacity over the long term,” he added. If that does not happen, the co-op would be left with substantial “stranded costs” that its customers would be forced to absorb without getting anything in return.

Read the article here.