The federal sequester, among other uncertainties, are some of the reasons that American Municipal Power said it would not be moving on with a planned natural gas-fired peaking plant with FirstEnergy (NYSE: FE).
The 873 MW peaking unit was supposed to be built at the site of FirstEnergy’s Eastlake coal-fired power plant in Ohio. The four units at the Eastlake plant are scheduled for retirement due to the Mercury and Air Toxics Standard.
In November 2012, AMP and FirstEnergy signed an MOU to site, build and operate the peaking unit. Construction was going to begin in the second half of 2014. AMP was to provide the construction financing and own 75 percent of the output when it was completed, and FirstEnergy would fund and own the remaining 25 percent of the output in 2016.
“We appreciate our excellent working relationship with FirstEnergy,” said AMP President and CEO Mark Gerken, “and look forward to a continued business relationship with them. This project had a lot of positives and some challenges, but the financial uncertainty today, on top of continued regulatory uncertainty, heavily impacted AMP’s decision.”
This story was originally published by Power Engineering online. It is republished with permission.