Dominion is likely to decommission the Salem Harbor coal-fired power plant in Massachusetts in June 2014 to avoid investing in expensive equipment that meet environmental standards.
Dominion spokesman Dan Genest told Reuters that the decommission doesn’t imply that the plant will be close in June 2014 itself, rather it will begin the process of shut down.
“Dominion will operate Salem Harbor as long as we can comply with all environmental regulations and can still make a profit,” Genest said.
The firm plans to retire the 738MW plant when the 2013-2014 forward capacity contract ends, if it’s unable to recover the cost of environmental upgrades needed for operation after that date.
In October 2010, ISO New England, a power-grid operator, rejected a permanent delist bid by the firm including a request to recover the environmental upgrades cost that would enable the plant to opt out of the 2014-2015 forward-capacity auction.
On 10 February 2011, Dominion has again filed to convert its permanent delist bid into a non-price retirement bid to allow the company to shut the plant in 2014.
ISO New England will do a reliability study to determine if any of the four units of the plant are needed for reliability during the 2014-2015.
If ISO New England orders the firm to keep the plant operational, Dominion plans to negotiate on a cost of service agreement to keep it running at least up to June 2015.