Bankruptcy Filing For One Of West's Biggest Coal Plants Shows Utilites Looking For Exit w/i 5 Years
In the fall of 2020, one of the West’s largest coal plants was due for repairs. So the operator of Colstrip Generating Station fired off a letter to its five co-owners with a $56 million plan to fix it. The proposal quickly went sideways. Four utilities with a stake in Colstrip balked, saying they could not support spending money on repairs that would keep the plant open beyond 2025. Instead, they demanded the plant’s operator, Talen Energy, reduce the plant’s budget and “successfully execute a strategy that provides a framework for our individual exits from the Colstrip project within the next 60 months.”
The exchange, outlined in federal bankruptcy filings, captures the fight over the future of Colstrip. The coal-burning behemoth has long sent power generated on the Montana prairie to Pacific metropolises such as Seattle and Portland. Four utilities from Oregon and Washington collectively own 70 percent of the 1,480-megawatt coal plant. But in recent years Colstrip has come to symbolize the fight over the future of the Western electric grid. The Pacific utilities — Avista Corp., PacifiCorp, Portland General Electric and Puget Sound Energy — are seeking to close the plant to comply with state climate laws. Their efforts have been opposed by minority owners NorthWestern Corp. and Talen, which argue the plant’s closure would decimate Montana’s economy and jeopardize the future of the West’s electric grid.
Now, however, the fight over Colstrip’s future is on hold. Talen’s power division filed for bankruptcy protection last month, resulting in an automatic stay of a federal court case that was set to decide the rules for negotiating the plant’s future. Talen has resisted efforts by its five fellow owners to lift the stay and allow that case to continue. Analysts said the bankruptcy has injected a new layer of complication into grid planning at a time when the West is grappling with how to address climate change without jeopardizing electricity supplies.
“The longer we wait, the harder it becomes,” said Diego Rivas, a senior policy associate at the NW Energy Coalition. “Some utilities have already planned for transition out of ownership either because they are required to or it’s uneconomic or both. Some of the owners are behind on that planning.”
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https://www.eenews.net/articles/bankruptcy-filing-complicates-outlook-for-western-coal-giant/
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