Dive Brief:
- Alabama Power will close its coal-fired Plant Gorgas in a matter of weeks, rather than spend hundreds of millions to make federally-mandated improvements, according to a company announcement on Wednesday.
- Gorgas began operating in 1917 and there have been several generating units there in the last 102 years. The plant will officially close April 15.
- Alabama Power said that since 2015, "cost pressures" have forced the utility to pare back its coal-fired generating units from 23 to 10. After Gorgas is retired, the company will have seven coal-fired units remaining, at three power plants.
Dive Insight:
Alabama Power's decision to shutter its Gorgas plant — some 102 years after it began operating — reflects a growing movement away from the fuel. The Institute for Energy Economics and Financial Analysis (IEEFA) estimated the United States retired 15.4 GW of coal capacity last year. And an additional 21.4 GW of coal capacity will go offline by 2024.
According to Alabama Power, it could cost $300 million to comply with new environmental mandates to continue operating Gorgas' three coal-fired generating units.
"We are also concerned that more regulations are on the horizon that could require additional, costly expenditures at the plant," Jim Heilbron, Alabama Power's senior vice president and senior production officer, said in a statement.
The utility says that by using a diversity of fuels, it can protect customers in volatile energy markets.
Despite an acceleration in coal plant retirements, the fuel remains essential to the United States electric grid. The U.S. still has 246 GW of coal capacity online, IEEFA said in September, and announced retirements through 2024 represent about 15% of that operating fleet.
