NRG moves to shutter Huntley power plant

Faced with low natural gas prices, a lack of profits and other adverse market conditions, NRG Energy Inc. is taking the first step today toward shutting down its Huntley power plant in Western New York.

An NRG spokesman said the power generating company would be filing a notice with the state’s Public Service Commission this afternoon to retire the Tonawanda coal-fired plant, which has two 190-megawatt generating units.

“Unfortunately the plant’s been losing money for a long time, and based on these very trying financial and market conditions, we have to unfortunately take a retirement of Huntley,” said Dave Gaier, a spokesman for NRG’s east region.

“We don’t see any scenario under which the economics of the plan and market conditions in this part of New York will allow us to continue to operate the plant,” Gaier added.

The retirement notice will be followed by a 180-day review period to determine whether the plant needs to keep operating to ensure there is enough generating capacity in the area. If the plant is needed for reliability, NRG would work on a service agreement with either the New York Independent System Operator or with National Grid. Otherwise, both units at Huntley would be shuttered on March 1, and the plant would be retired.

The plant currently employs 79 workers.

NRG has been down this road in recent years with its Dunkirk coal plant. In that case, the state PSC determined that NRG’s move to mothball the plant would cause reliability problems. As a result, a plan was approved last year to repower three of the plant’s four units with added natural gas capacity for 10 years.

However, the repowering project at Dunkirk is now on hold as the result of a lawsuit filed by Entergy, a competitor of NRG, which is arguing that the federal government, not the state, actually has jurisdiction over Dunkirk. The plant’s fourth unit is still operating and there are still 66 employees at the site, but it will be mothballed at the end of the year.

As the Huntley plant faces a similar challenge, Gaier blamed the potential shutdown on dysfunction in the state’s energy markets.

“The competitive energy markets in New York are not meeting the reliability needs of the regional electrical system, because we’ve seen that generators that are providing important reliability services are not being compensated adequately for the value they provide,” Gaier said. “Then often when these generators have to leave the market because they’re uneconomic, they’re often required to stay in the market because they’re needed for reliability, so in our view this demonstrates that energy and capacity markets in New York are just not adequately reflecting the needs of the electrical system.”