Companies Mull Repurposing Retired Coal-Fired Plants

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Researched by Industrial Info Resources (Sugar Land, Texas)--In the U.S. these days, it's everywhere: reduced carbon emissions goals, that is. Major power providers such as Duke Energy Corporation (NYSE:DUK) (Charlotte, North Carolina), Xcel Energy Incorporated (NASDAQ:XEL) (Minneapolis, Minnesota) and NextEra Energy Incorporated (NYSE:NEE) (Juno Beach, Florida) have net-zero carbon goals in place and have specific schedules in mind, which involve the retirement of coal-fired power plants.

Industrial Info expects about 70 gigawatts of coal-fired plant unit retirements in North America from now through 2030. While the retirement of plants is viewed positively throughout most of the Western world, is it the best idea to simply let these assets be disconnected from the grid when they are equipped with the basic infrastructure (albeit, often aging) to deliver power to millions of users throughout the U.S.? The transmission and distribution infrastructure from coal-fired assets is in place, so how feasible is it to scrap the coal-burning plants and transform the acreage into energy storage, solar or small modular reactor (SMR) nuclear facilities? As the world navigates through the energy transition, the answer is becoming clearer.

The effects of shuttering a coal-fired plant extend beyond the environment. Municipalities rely on the tax benefits and jobs the plants provide the community. Power Magazine reported that the closure of two coal-fired plants within 20 miles of each other in Illinois "resulted in the loss of nearly $2 million in property taxes in 2019, about $950,000 in reduced school district funding, and 135 jobs."

SMR Transition
In a presentation earlier this year, the Montana state legislature made a case example of a situation in rural Adams County, Ohio, when two coal-fired plants closed on the same day, leading to "the loss of more than 700 jobs and devastation to the local economy."

The purpose of Montana's Energy and Telecommunications Interim Committee's presentation was to tout the benefits of installing SMRs at retiring coal-fired plants, which according to the presentation, would include 900 manufacturing and construction jobs over four years of construction and 300 permanent jobs during 60 years of plant operation, in addition to jobs added to local economies coming from spenders with more money in their pockets, and continued payment of state and local property taxes.

A presentation from one of the U.S. embassies in Europe points out that directly transitioning coal-fired plants to SMRs avoids the costly interim process of conversion to natural gas. Seen as a temporary stepping stone for companies in their energy-transition plans, natural gas-fired plants will have to be decommissioned within a relatively short time compared with SMR facilities to help meet net-zero emissions goals.

Solar
Several companies are looking at establishing solar energy plants, often accompanied by battery energy storage, at retired coal plants. Examples include Photosol US (Lehi, Utah), which is developing solar power facilities with battery storage at the retiring San Juan coal-fired power station in New Mexico. Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project Database can click here for related project reports. The company has signed power purchase agreements for both the solar and battery energy with Public Service Company of New Mexico (Albuquerque, New Mexico), owner of the coal plant. Photosol also has solar ambitions for retiring coal-fired sites in Kansas and Nebraska.

J-Power USA (Schaumberg, Illinois) is developing 50 megawatts (MW) of solar and 190 MW of battery energy storage at the retired Birchwood coal facility in Virginia. Subscribers can click here for the detailed report on the solar installation and here for the battery energy storage system.

In September 2021, Illinois governor J.B. Pritzker signed legislation that supports Vistra Corporation's (NYSE:VST) (Irving, Texas) plans to construct 300 MW of solar power and 150 MW of battery storage at nine retired or to-be-retired coal facilities in the state.

Thermal Energy Storage
When one thinks of energy storage solutions, first thoughts often involve battery energy storage systems, but there may be a better alternative for retired coal plants: thermal energy storage, which provides similar energy-storage solutions for renewable plants when wind the isn't blowing and the sun isn't shining. As Britt Burt noted in Industrial Info's recent North American Mid-Year Industrial Market Outlook, with lithium-ion battery storage, "the discharge range is only about four hours. That doesn't give us a long time." Thermal energy storage has a longer discharge rate, which can come in at around 10 hours.

As Power Magazine reports, "While plant equipment isn't always reusable, the interconnect, labor, facilities, and similar spinning thermal performance characteristics make thermal energy storage a natural replacement for coal facilities." Compared with lithium-ion battery solutions that provide very short-term energy output, thermal storage can charge and discharge continuously for days, providing increased grid resiliency. In addition, "Thermal energy storage systems are mechanically similar to coal-fired plants, so demand for workers with the same skills would remain high, allowing incumbent workforces to transition to operating the new storage system and preserving a portion of the local property tax base, offsetting some impacts from closing coal plants."

In a May 2021 presentation to state officials, Xcel Energy proposed installing a molten salt-based energy storage system at its Hayden Generating Station in Colorado, which is set to retire in 2028. According to Colorado Public Radio, "The company would add a tank full of salt and melt it at times when the grid fills with excess renewable energy. When energy demand outpaces supply, one of the existing steam turbines could then transform the stored heat back into electricity." Duke Energy also has expressed interest in the technology's use at a coal plant in North Carolina.

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