IPL converting coal to natural gas as emissions controls fail to produce desired results

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The Indiana Utility Regulatory Commission (IURC) has approved Indianapolis Power & Light's (IPL) request for a Certificate of Public Convenience and Necessity (CPCN), allowing IPL to invest approximately $600 million into a new 650 MW combined-cycle gas turbine (CCGT) power station near Martinsville, Indiana and $36 million to convert two units at the Harding Street Generation Station totaling 200 MW from coal to natural gas.

Harding Street Station. Credit: IPL

The CCGT will reduce the rate of sulfur dioxide (SO2), nitrogen oxide (NOx) and particulate matter emissions by more than 98 percent; water use will be reduced by 97 percent.

This is good news considering the 55-year-old Harding Street plant alone has been hailed as the number one source of industrial pollution in Marion County, releasing more than 1.6 million pounds of toxins in 2012, according to the U.S. Environmental Protection Agency. The EPA's most recent figures also show that the plant was responsible for 88 percent industrial pollution released in the County -- even though IPL has invested more than $280 million in emissions controls since 2000.

The CCGT will be located in Morgan County at IPL's Eagle Valley Generating Station, five miles north of Martinsville. Once complete, the project will bring about $1.6 million per year into Morgan County through local tax revenue, and an overall economic benefit to the state during construction of more than $857 million and $48 million per year during operation.

"We are pleased that the IURC approved IPL's plans as the most cost-effective and reliable solution to replace generation that will retire as a result of increasing environmental regulations," said IPL President and CEO Kelly Huntington. "Building a CCGT and refueling two of our Harding Street units will ensure our ability to meet the future needs of our customers and diversify our generation portfolio. In 2017, IPL's reliance on coal-fired generation will have decreased to only 54 percent, from nearly 80 percent 10 years before, with natural gas, wind, solar and oil powering the rest of our customers' needs."

The CCGT project will begin construction in third quarter 2014 and is expected to be operational in 2017. The conversion of Harding Street Units 5 and 6 will begin in the fall of 2015 and be completed by early 2016.

Including this CCGT project, in the past six months, IPL has received final approvals for, or reached financial closing on approximately 2,600 MW of expansion projects in the United States, Chile, India and Panama, which will come online between 2015 and 2018.

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