The American Electric Power Co. is expected to announce plans to purchase three coal-fired electric power plants in Tennessee, Kentucky and Louisiana.
The utilities are seeking a purchase price in the range of $1.2 billion to $1 in the market, according to the New York Times.
The utilities have been pushing to get more power out of the coal-burning power plants for more than two decades.
But it’s not as simple as adding more coal to a grid as some think, according.
“The market will have to provide a more compelling value proposition,” John R. Bresnahan, a senior vice president at Edison Electric Institute, told the Times.
“Coal is a cleaner, more reliable fuel and the utility will have a greater opportunity to make money from the sale of coal.”
Bresnahan said the companies have been looking at various fuel options for years and have been evaluating various coal-based power plants.
“[A]s we move towards a transition to renewables, we’re going to be looking for ways to use this fuel as efficiently as possible,” Bresniahan told the newspaper.
Coal-fired power plants have been on the rise since the advent of new technology in the 1980s and 1990s, said David McLean, a professor at Northeastern University’s Kennedy School of Government.
In his study, McLean said that coal-electricity plants tend to produce less carbon dioxide and heat than natural gas plants, which is why they are less expensive to build and maintain.
However, the utility also said it would be taking steps to reduce carbon emissions, which has led some to question how the utility could get away with selling coal-powered electricity.
Environmentalists are concerned about the impact of COVID-19, or coronavirus, on the region.
A study from the Center for Energy and Environment found that if the country were to continue burning coal, the COVID outbreak would increase by as much as 1.7 billion tons of CO2 per year by 2040, according to the Center.
“As a consequence of the rapid pace of COX-2-related disease outbreaks in the United States, the future health of the population is of paramount concern,” the study states.
For now, the utilities are planning to purchase the plants from the Edison Electric, a joint venture of Duke Energy and Southern Company.
(Courtesy: New York Public Library) The utilities have also been looking to get into the energy-storage market, which relies on the storage of power from coal plants to provide electricity.
The two utilities have partnered to develop a joint utility-scale project in Louisiana called the Boulanger Energy Storage and Power Facility (BSEPF).
The project, which will be the largest solar project in the U.S. and will generate more than 500 megawatts of solar energy, is expected take about five years to complete.
Bresniagan said that the company will be looking to partner with solar developers to develop the BSPF.
“The BSPFs will provide a massive opportunity to drive a significant and growing market for this type of energy storage,” Bretenham said.