Anglo American coal bidders down to three, say sources
The final bidders are down to Yancoal Australia, Stanmore Resources and Peabody Energy.
With clean air regulations mounting and shale gas production booming, more than 12,000 MW of coal-fired capacity in the U.S. has converted or is slated to convert to alternative fuel sources between 2011 and 2023, according to SNL Energy data, which now tracks unit fuel conversions.
Natural gas, which has quickly leapt to the front of the line of desired power generation fuels, dominates the list of unit conversions. Of the approximately 11,288 MW of coal capacity planned to be converted, 10,894 MW is being shut down in favor of gas-fired generation, according to SNL Energy data.
The number of coal-to-gas conversions is expected to increase going forward as generators retrofit older coal units or build new gas generation on sites where coal units have been dismantled.
The latest generator to propose a sizable coal conversion is Ameren Corp. unit Ameren Missouri, which on Oct. 1 unveiled a new 20-year Integrated Resource Plan that calls for two units at its 873-MW Meramec Energy Center to be converted from coal to gas. The proposed Meramec conversion is part of Ameren Missouri’s larger plan retire a third of its coal power capacity, install 478 MW of renewable generation and 600 MW of new gas generation. Ameren Missouri is legally known as Union Electric Co.
NERC regions seeing the most activity on the coal conversion front are ReliabilityFirst and SERC Reliability Corp., both of which are within close reach of major shale gas plays, enabling them to capitalize on increased U.S. gas supply. ReliabilityFirst tops the list with more than 4,600 MW of coal capacity slated for conversion, followed by SERC, where more than 3,800 MW of coal capacity has been proposed to be converted to gas, based on SNL Energy estimates.
The company leading the charge on coal-to-gas conversions is NRG Energy Inc., which owns a number of older coal plants in the Northeast that can tap into the flood of gas being produced out of the Marcellus Shale. NRG has tapped approximately 4,000 MW of coal-fired capacity to be converted from coal to gas, including several larger units. NRG’s Avon Lake unit 9, Big Cajun unit 2, and Joliet units 7 and 8, all of which are more than 500 MW in size, are among the largest single coal units in the conversion pipeline.
Keep reading the full report and analysis here.
