Power Suppliers To Purchase Part of Peabody Project

Issue 6 and Volume 108.

A group of Midwest rural electric cooperatives and municipal agencies has signed a letter of intent to acquire partial ownership in the Prairie State Energy Campus in Washington County, Illinois. The 1,500 MW power plant and coal mine, currently under development, would supply about a third of the group’s power needs.

Conceptual rendering of Prairie State Plant — Illustration courtesy of Peabody Energy.
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The group includes the Indiana Municipal Power Agency (IMPA), the Missouri Joint Municipal Electric Utility Commission (MJMEUC), Wolverine Power Supply Cooperative (WPSC) in Michigan, and other municipal agencies and co-ops. The agreement calls for the group to own approximately one-third of the project, which includes the coal reserves, generating plant and output. The letter of intent is subject to a number of conditions including final agreements, permitting, financing and construction of the plant.

“Prairie State represents a secure, reliable, low-cost electricity source for our members,” said IMPA President Raj Rao. “In an age of high-priced competing fuels like natural gas, we look forward to securing long-term electricity supplies using coal.”

Duncan Kincheloe, general manager and CEO of MJMEUC, said, “We see shrinking reserves of low-cost baseload electricity generation in the region, and Prairie State offers our customers good peace of mind very near our loads, just across the Mississippi River. Prairie State will provide low-cost electricity in an environmentally responsible manner for decades to come.”

Tom Stevenson, president and CEO of WPSC, said Wolverine’s interest in the Prairie State project was due in part to the Federal Energy Regulatory Commission’s vision to establish regional transmission organizations and the independence of the Midwest Independent System Operator (MISO), which creates open, regional access to broader wholesale markets.

Coal products from Peabody Energy — the world’s largest private-sector coal company — provide more than 10% of all U.S. electricity and more than 2.5% of electricity worldwide. Peabody is holding discussions with other potential partners and wholesale customers for Prairie State. The company is also developing the Thoroughbred Energy Campus, a nearly identical mine-mouth coal-fired generating project, in Kentucky.