Duke Energy will retire four coal units and possibly two oil-fired units under terms of a settlement reached between the company and four citizen and environmental groups over outstanding air permits for the company’s Edwardsport Integrated Gasification Combined Cycle (IGCC) project.

The agreement resolves a long-standing dispute over air permits for the now-operational IGCC plant in Knox County, Ind., which were issued by the Indiana Department of Environmental Management in 2008. “Importantly, under the settlement [the air permits] remain approved with no changes,” Duke Energy said on Friday.

The settlement agreement reached with the Sierra Club, Citizens Action Coalition, Save the Valley, and Valley Watch will instead force it to shut four coal units at its 668-MW Wabash River station in Vigo County, Ind. The company had previously announced that the units, which total 350 MW, could retire by the Mercury and Air Toxics Standards (MATS) compliance deadline in 2015, but the settlement stipulates that the company must complete the retirements by the compliance deadline or, if the mercury rule is vacated or delayed, by June 2018. It also requires Duke Energy to cease burning coal at a fifth 318-MW unit at the Wabash River plant by June 2018. The company said it has been exploring converting that unit to natural gas.

The settlement also gives Duke Energy two options: Either to implement a 30-MW feed-in tariff for solar photovoltaic power or build/contract 15 MW of wind or solar power. If the company chooses the second option, it will also be required to retire two 40- to 45-year-old oil-fired peaking stations—the Miami Wabash and Connersville units—totaling about 166 MW by June 1, 2018.

Sources: POWER, Duke Energy