Georgia's Yates Coal-Fired Power Plant Could Close If Environmental Policy Not Addressed

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Earlier this year, Georgia Power Company (NYSE:GPU) (Atlanta, Georgia), a subsidiary of The Southern Company (NYSE:SO) (Atlanta), announced that it was placing all of the proposed environmental upgrades at the company's Yates coal-fired power facility in Coweta County, Georgia, on hold. After speaking to company officials, Industrial Info has learned that Georgia Power is prepared to close this facility in 2015.

The reason for the possible closure is something that is being seen with increasing frequency in the coal-fired sector of the Power Industry: uncertainty about the impact of future environmental legislation, particularly legislation affecting emissions of sulfur dioxide, nitrogen oxides, mercury, particulate matter, and carbon dioxide. Georgia Power and utilities across the country are awaiting a clear set of guidelines regarding emissions controls. With future requirements uncertain, utilities are not willing to spend billions of rate payer dollars on retrofits.

The Yates power station was commissioned in the 1950s and houses seven pulverized coal-fired units, each containing an Alstom/CE Boiler and General Electric (NYSE:GE) steam turbine. The facility is located on 2,400 acres along the Chattahoochee River, employees approximately 300 people, and is the largest taxpayer in Coweta County. Yates generates more than 5 million megawatt-hours annually. The effects of closing the facility would be large to the surrounding area.

The closure would not only leave the 300 employees of the plant without jobs, but Coweta County would lose $1.8 million in annual property taxes, $800,000 in sales taxes, and $2 million in other taxes paid by the plant each year. The closure of the facility would filter down to local governmental agencies budgets, including the Coweta County School System, the Newnan city government and roads, infrastructure and other services on which the 50,000-plus people in the area rely.

Local businesses, such as the Whiteburg Super Save, which is about a 15-minute drive from the plant, and Sprayberry's Barbeque, which according to staff, "does quite a bit of business with the folks at Yates," would see their numbers of customers decline. The closure would also affect services providers that do business with Yates, including the businesses that repair and supply valves, motors and seals, and those that provide telecommunication services and support to the facility. Then, of course, there is railway operator Norfolk Southern Corporation (NYSE:NSC) (Norfolk, Virginia), which delivers the 5,000 tons per day of coal that plant consumes. Finally, the folks at Yates contribute to several charities, such as the American Cancer Society, United Way, March of Dimes and others.

As one can see, the closure of a single coal-fired plant can have a drastic effect on the surrounding area. Many such facilities are in a situation similar to Yates. While these plants are willing to install pollution-control measures, they simply want sound guidelines and firm direction before investing the massive amounts of money required for such projects. Additionally, if these emissions-control measures are implemented, the plant owners need to be guaranteed that they will be able to recoup project costs and not simply be handed legislative requirements without receiving support in accompanying rate cases.

View Plant Profile - 1013872

Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. IIR's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.