The expected renaissance for U.S. coal-fired generation has been more evolutionary than revolutionary: Less than half of the announced plants will likely progress to construction. However, the percentages for coal-fired plants aren’t significantly different from those for combined-cycle plants a decade ago, when dozens were ultimately canceled, leaving developers with warehouses full of unused gas turbines. The difference this time: The threat of carbon control legislation has moved many projects to the "wait and see" category.
Over the past few years, the U.S. power industry has experienced both a rebirth and dearth of new coal-fired generating capacity. It seems like yesterday that Industrial Info Resources was tracking 200 new units representing more than 85,000 MW that were proposed to be built across the country. Over time, continuously escalating construction costs, coupled with carbon legislation on the horizon, ended the coal-fired renaissance before it actually got started. Over the past few months, costs have stabilized, but the uncertainty about future environmental regulations lingers. Since the beginning of 2007, 84 projects and $68 billion of new coal-fired generation capacity have been confirmed as cancelled or placed on indefinite hold.
Despite the setbacks, a respectable amount of new coal-fired generation remains under construction in the U.S. At last count, 32 new coal-fired units accounting for 15,919 MW of capacity are under construction (Figure 1). These new units are being built as part of 24 projects and nearly $30 billion in capital spending.
1. Coal projects still live. New coal-fired power plant builds are going strong, although the numbers are fewer than once predicted. Source: Industrial Info Resources
One of the more active regions is the southwestern U.S., where Oak Grove Management Co. LLC, a subsidiary of Luminant Energy, is under way on the 1,600-MW Oak Grove Generating Station near Franklin, Texas. In the Great Lakes region, Duke Energy Indiana Inc., a subsidiary of Duke Energy Inc., has started construction of the 630-MW Edwardsport integrated gasification combined-cycle plant in Indiana. In Virginia, Dominion Resources Inc. is under way with construction of the 585-MW Virginia City Hybrid Energy Center.
Projects currently under construction are all expected to be completed in 2010 through 2012. After this point, uncertainty abounds as to when there might be any significant amount of new coal-fired capacity moving forward.
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