Operator: 2 units of Colstrip coal plant to close this year

HELENA, Mont. (AP) — The company that operates a coal-fired power plant in eastern Montana said Tuesday it will close two of the plant’s four units about 30 months ahead of schedule because of the high cost of running them and the unwillingness of its coal supplier to lower prices.
Talen Montana said in a statement the older units of the Colstrip Steam Electric Station, with a combined 614-megawatt capacity, will be permanently retired on Dec. 31. The newer Colstrip units, which generate the bulk of the 2,100-megawatt plant’s output, will continue operating although those whose livelihoods depend on the plant worry it also may be shuttered early.
The partial closure would be the latest among coal-fired plants that are going offline across the nation as demand for coal drops, environmental regulations increase costs and states worried about the effects of climate change seek to divest of their power supply that’s generated by coal.
The older units had been slated for closure by mid-2022 as part of a settlement in an environmental lawsuit. The decision to retire the units early came after an extensive review and exhaustive efforts to make the units economically viable, Talen Montana President Dale Lebsack said.
“Fuel constitutes the bulk of our operating cost, and our repeated efforts to negotiate lower fuel prices with Westmoreland Rosebud Mining, the plant’s sole and only historically permitted fuel supplier, have been rebuffed.” Lebsack said in the statement. “Rather than working with us to keep Units 1 and 2 open, Westmoreland is proposing to increase the units’ fuel cost going forward.”
The adjacent Rosebud mine is owned by a subsidiary of Westmoreland Coal Co., which emerged from bankruptcy this spring as a private company owned by former creditors. A message left at the company’s headquarters in Englewood, Colorado, was not immediately returned on Tuesday.
Colstrip is the one of the largest coal plants west of the Mississippi River, and the small town where it’s located is dependent upon the plant and the mine for jobs and a large part of its economy. The town has been bracing for the closure because of a legal settlement with conservation groups aimed at resolving a lawsuit over decades of pollution from the plant, but its residents had hoped to keep the units running at least until the June 2022 deadline mandated by the settlement.
Pennsylvania-based Talen for years has been saying the plant it not economically viable, with company officials saying in 2017 that they were losing about $30 million a year. State lawmakers made several efforts to prop up the plant, including passing a measure allowing the company to borrow up to $10 million a year from the state and a failed bill to allow NorthWestern Energy to buy out other Colstrip owners for $1.
Residents also worry that the plant’s newer units also will be shut down a few years later as Colstrip’s other utility owners located in Washington and Oregon seek to remove coal from their own power portfolios.