Appalachian Power to buy 2 W.Va. AEP plants

VICKI SMITH Associated Press Published:

CHARLESTON, W.Va. (AP) -- The president of Appalachian Power said Thursday the utility will soon file paperwork with state and federal regulators to buy two West Virginia power plants from its parent, American Electric Power.

Charles Patton says new environmental rules have forced Ohio-based AEP to decide whether to idle, invest or sell its many plants, and the two 800 megawatt Mitchell units near Moundsville are going to be sold.

At a coal mining symposium in Charleston on Thursday, Patton said the purchase would be a good deal for his company, which currently buys power from those plants, and for coal producers and customers.

"We can go from being a renter to a mortgage payer," he said, "and we think we can do without increasing costs for consumers."

Appalachian Power provides coal-generated power to 1 million customers in West Virginia, Virginia and Tennessee. Purchasing the West Virginia units would ensure their survival for 30-35 years without any significant increase in costs to consumers, Patton said.

It's also good news for coal operators, he said, because his company burned 18 million tons of West Virginia coal, at a cost of more than $1 billion.

New clean-air regulations have forced AEP to shut down 24 megawatts of coal-fired power in West Virginia, but Patton said those old, inefficient plants were set to close for economic reasons by 2020 anyway. The new rules just sped up the closures.

He told coal operators not to panic about losing utilities as buyers because the larger 800 megawatt "supercritical" plants and 1,300 megawatt "ultra-supercritical" plants will continue to be competitive well into the future.

"I can tell you there will not be any new coal plants built, with the current price of gas and the forecast for the future for gas," Patton said, but existing units that have scrubbers will operate for decades to come.

"So our relationship with coal will continue as long as those large plants are allowed to run," he said.