Obama Administration Regulations Force Power Plant Shutdowns; Boosting Energy Prices and Destroying Jobs
AEP: EPA Plan Expected To Cost $6 Billion To $8 Billion Through Decade's End
DOW JONES NEWSWIRES
By Tess Stynes
American Electric Power Co. (AEP) estimates it may need to spend $6 billion to $8 billion through the end of the decade to comply with the Environmental Protection Agency's proposed regulations on coal-fueled power plants if they are approved in their current form.
The company has been reviewing options to shut down nearly 6,000 megawatts of coal-fired production in anticipation of tighter environmental regulations.
AEP, whose utility operations stretch from Texas to Ohio, said high demands for labor and materials could drive the potential capital investment higher owing to a constrained time allowed to make changes required under the plan. It said the estimated spending is in addition to $7.2 billion AEP has spent since 1990 to reduce emissions from its coal-fired generators.
AEP said under the proposed regulations it would prematurely shut nearly 25% of its current coal-based capacity, and about 65% of the company's generating capacity is coal based. The company predicted the loss of about 600 jobs; it has about 19,000 employees. Under AEP's plan, it would close five generating plants--three in West Virginia, one in Virginia and one in Ohio.
It also would either retire, convert to gas or install emission-reduction equipments on some units across operations at other generating operations in several states.
AEP also projects that the tight timeframe to comply would boost electricity prices by 10% to more than 35% at a time when the industry is still trying to recover from the economic downturn.
Shares were down 8 cents at $37.58 in recent trading.