Kentucky Power files motion to withdraw Big Sandy scrubber case

(Story by Ronn Robinson)

FRANKFORT — Kentucky Power filed a motion May 30 before the Kentucky Public Service Commission, which was accepted May 31, to withdraw its December 2011 filing for a flue gas desulfurization system (or scrubber) on its 800-MW Unit 2 at its Big Sandy Plant near Louisa. The motion asked the commission to end its consideration of the company’s filing for a Certificate of Public Convenience and Necessity to construct the environmental retrofit at the plant.

Approval of the plan as submitted by Kentucky Power would have resulted in an approximately 30 percent rate increase on customers’ bills. The commission was expected to hand down a decision on the case this week.

The motion was filed without prejudice, which means the company may still consider adding a scrubber system to Big Sandy after it re-evaluates its needs to meet the short and long-term energy needs of its customers at the most reasonable cost. The company has not determined what plan it will take going forward, but will do so in the coming weeks and submit a new environmental plan to the commission.

One of the factors that led to this decision is it now appears there will be sufficient market generating capacity in 2015-2016 to meet the needs of Kentucky Power customers following the recent PJM energy auction. This fact allows Kentucky to examine additional options in meeting the generation needs of its customers.

“The action being taken is the right thing to do,” said Greg Pauley, president and COO of Kentucky Power. “It is in the best interest of our customers, shareholders and company. It will allow us additional time to review all options for meeting our customers’ needs and make sure the ultimate decision with regard to Big Sandy is the proper decision for all stakeholders.

“The energy industry is experiencing very dynamic and challenging times,” he continued. “It is imperative that decisions being made are done so with the best information available and able to withstand the test of time,” Pauley said.