Coal, Emissions

Allegheny’s scrubber projects to cost more than expected

8 September 2006 — Allegheny Energy, Inc. announced today that it expects the cost of installing flue gas desulfurization equipment (scrubbers) at the Fort Martin and Hatfield’s Ferry power stations to be higher than previously estimated.

The scrubbers at the Fort Martin 1,107-MW plant near Maidsville, West Virginia, US were estimated to cost $338 million. Allegheny now estimates the costs at $500 to $550 million. The company used securitization through issuing environmental control bonds to pay for the project and is now considering asking the West Virginia Public Service Commission for approval of the additional costs. The projects were financed through a West Virginia customer surcharge that will gradually repay the bonds.

The estimated cost of the scrubbers for the 1,710-MW Hatfield’s Ferry facility near Masontown, Pennsylvania, US has grown from $550 million to $650 million.

Allegheny attributes the higher cost to a number of factors, including construction challenges caused by site-specific characteristics, necessary changes in material-handling equipment and higher material costs.