Report Shows Challenges NRG's Huntley Power Plant Faces in Today's Coal Market

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Researched by Industrial Info Resources (Sugar Land, Texas)--The forecast for NRG Energy Incorporated's (NYSE:NRG) Huntley coal-fired plant in Towanda, New York, near Buffalo, doesn't look very bright. The financially stricken plant is currently averaging $1 million of debt in pre-tax earnings every year. The plant is being affected by low natural gas prices, a lack of electricity demand, and other coal market woes.

The Institute for Energy Economic and Financial Analysis (IEEFA) released a report on Tuesday outlining a detailed financial analysis of the Huntley coal-fired plant. It presents possible ways for workers and the community to move forward. The report was created at the request of the Clean Air Coalition of Western New York.

Three speakers took part in the phone-based event:

• Tom Sanzillo, former first deputy of the New York State Comptroller, IEEFA's director of finance and co-author of report
• Cathy Kunkel, report co-author and IEEFA fellow
• Erin Heaney, Clean Air Coalition of Western New York's executive director

The report shows that NRG's power plant earnings have dropped in recent years, from a range of $56 million to $110 million in 2005-08, to a yearly average of $1 million in losses for 2009-12. There are many factors for this downtrend: low natural gas prices, stagnating power demand due to the recession, and increased energy efficiency, as well as uncompetitive coal prices.

The IEEFA report does not indicate any future reversal in the plant's outlook. The analysis outlines ways to address employment and fiscal problems that will arise if that plant closes its doors.

A streaming audio replay is available at http://www.ieefa.org. The news event references PowerPoint slides that participants are encouraged to review at the IEEFA homepage.

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