NRG Energy could deactivate five units at two coal-fired power plants in Maryland because new regulations proposed by the state to curb emissions of nitrogen oxides (NOx) and sulfur dioxide (SO2) will require pollution controls that cannot be economically justified, the New Jersey–based company said. 

NRG last week notified regional grid operator PJM Interconnection that it plans to deactivate two units at the 2.6-GW Chalk Point plant in Aquasco, Md., and three coal units at the 853-MW Dickerson plant in Dickerson, Md., by June 2017. All five units have a combined capacity of about 1.2 GW and are more than 50 years old.

“This filing preserves our option not to participate in the 2017-2018 PJM capacity auction, but doesn’t actually prevent us from participating,” NRG spokesperson David Gaier told POWERnews on Wednesday.

Maryland in 2007 implemented the Maryland Healthy Air Act, which the state itself calls the “toughest power plant emission law” on the East Coast. Emissions reductions required by the second phase of that initiative requires the state’s plants to reduce NOx emissions by about 75% from 2002 levels and SO2 emissions by 85% from 2002 levels.

Power plants in the state have invested $2.6 billion in technology to comply with the Healthy Air Act, but “Maryland is still not meeting standards for ground-level ozone,” the state said in a statement. Earlier this week, Maryland and seven other Northeast and Mid-Atlantic states petitioned the Environmental Protection Agency (EPA) to require nine upwind states—Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, Tennessee, Virginia, and West Virginia—to reduce air pollution generated within their borders.

According to NRG, the state “intends to implement more stringent environmental regulations for coal-fueled power plants,” specifically governing NOx and SOx emissions. ” Those rules could require the costly installation of selective catalytic reduction systems for the Chalk Point and Dickerson units.

“Under market conditions for the foreseeable future, the significant capital investment required to install these systems can’t be justified economically,” Gaier told POWERnews.

The two plants formerly owned by GenOn, which last year merged with NRG Energy, have been under state scrutiny for some time. The Maryland Department of the Environment (MDE) in June filed a lawsuit in the Maryland District Court alleging the two NRG Energy–owned power plants had installed faulty water treatment systems to control water generated by a new air emissions system that released excessive nitrogen and phosphorous amounts into the Patunxet and Potomac rivers over the last four years. The nitrogen and phosphorous output far exceeded the yearly levels set in state permit received in 2009 violated the federal Clean Water Act and state laws, the agency said.

The Chalk Point Station exceeded its maximum nitrogen output level at 329 pounds per year by 7,229 pounds in 2010, and 1,941 pounds in 2012. The Dickerson Generating Station exceeded its maximum nitrogen output level of 511 pounds per year by 2,639 pounds in 2010 and 3,052 pounds in 2012, according to the suit. The state sought injunctive relief and penalties of up to $32,500 per violation—with each day of pollution constituting a separate violation.

NRG, however, says that plans to deactivate the Chalk Point and Dickerson plants are “totally unrelated to the wastewater matter.”

“NRG remains in negotiations with MDE and we are looking forward to settling those issues.” Gaier said.

Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)