No hope for Mitchell power plant
By Joe Napsha
Published: Friday, Oct. 4, 2013, 12:11 a.m.
A FirstEnergy Corp. executive told state officials Thursday the company is not wavering from its plans to deactivate two area coal-fired power plants on Wednesday, and offered no hope that the facilities would reopen or that 380 jobs would be saved.
“Those plants are losing money today and will lose money in the future. Our plans are not to run those units again,” said James H. Lash, president of FirstEnergy Generation, which operates the plants - the 370-megawatt Mitchell Power Station in Union Township and 1,710-megawatt Hatfield's Ferry plant near Carmichaels, Greene County.
Speaking at a state House Consumer Affairs Committee hearing in Monongahela, Lash said some equipment at the plants would be disassembled, while the company would maintain environmental controls at the sites.
The first round of layoffs at Hatfield's Ferry is due to begin on Oct. 11, with the second phase a month later and the last round on Dec. 11, said Timothy Hall of Masontown, vice president of the Utility Workers Union of America, Local 102.
“It's like going to work in a funeral home,” Hall said of the plant, where about 100 union workers remain. “Hatfield's Ferry been the crown jewel (of power plants) for years.”
FirstEnergy Corp., the Akron-based parent of FirstEnergy Generation, announced in July it would close the plants along the Monongahela River.
When questioned by State Rep. Pam Snyder, D-Waynesburg, about keeping the plant open, Lash said FirstEnergy was not interested in any contract that would keep the plants operating in the event demand for electricity increases.
PJM, a Valley Forge-based power transmission organization covering 13 states including Pennsylvania, did not offer any such contract to the company and such a contract would not make the two power plants profitable, Lash said.
PJM could lose the 2,000 megawatts of power generated by the two plants and still have sufficient power in reserve, said Michael J. Kormos, PJM executive vice president of operations.
Lash painted a grim future for coal-fired power plants, saying electricity is priced too low in a market where demand for power has dropped and the capital investment needed to meet environmental regulations is too high. Electricity prices have dropped 10 percent from summer to fall, while the cost of natural gas –which also is used as a fuel for power generation – remains at historic low levels because of the abundance of gas from supplies such as the Marcellus shale reserves, Lash said.
It would take another $270 million investment to make the two plants compliant with environmental regulations, including the pending Mercury and Air Toxic Standards rule, which would result in the plants being greater money losers if the company were to make those investments, Lash said.
The previous owner of the plants, Allegheny Energy of Greensburg, spent $715 million in 2009 to install scrubbers at Hatfield's Ferry.
When pressed by state Sen. Tim Solobay, D-Canonsburg, about reports that International Electric Power of Pittsburgh had made an offer to buy the plants from FirstEnergy, Lash said the utility never received a proposal.
“We've never had anyone make us an offer to buy our (power) plants. ... The prices being offered are not very good,” Lash said.
An International Electric Power spokesman could not be reached for comment.
Even when the plants are shut down, they have a value and FirstEnergy “is not out there seeking buyers,” Lash said.
As for employees displaced by the closures, Lash said there will be job “opportunities” for about 140 of the 175 power plant employees who are members of the Utility Workers Union. The workers can apply for other FirstEnergy jobs and undergo training for work that will be “in the South,” Lash said.
Fifty-two of the union members qualify for retirement, he said.
But, those offers of job opportunities hinge on the Utility Workers accepting the company's contract offer, which Hall said would cost workers millions of dollars.
Hall contended that FirstEnergy's approach is, “you eat this garbage, or we'll (FirstEnergy) throw you out on the street.”
Hall said all but a skeleton crew will remain after Dec. 11.
At the Mitchell power plant, where about 55 unionized workers remain, layoffs are expected to begin Wednesday, said Greg Garry, president of the UWU local union at the plant.
“The contract they offered will slice our throats,” Garry said.
Joe Napsha is a staff writer for Trib Total Media. He can be reached at 724-836-5252 or email@example.com.
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