New Jersey-based PSEG Power is accelerating its run away from coal-fired power and apparently is even willing to take on losses to do so.
The utility has agreed to sell its 776-MW portion of the Keystone and Conemaugh coal-fired generation facilities in Pennsylvania sometime in the second half of this year, according to the filing. The buyers are companies called Chief Conemaugh II, LLC and Chief Keystone II, affiliates of ArcLight Capital Partners.
Parent company Public Service Enterprise Group and PSEG Power expect to take a one-time pre-tax impairment charge of $375 million to $415 million, because the anticipated sales price is less than the current book value of the stake, according to the company’s filing with the U.S. Securities and Exchange Commission.
“With this announcement, PSEG Power eliminates a non-core asset and is one step closer to completing its coal exit strategy, with the remainder of the company’s coal generating assets either sold or scheduled for early retirement,” reads Monday’s press release.
In October 2016, PSEG Power announced the retirements of its Hudson and Mercer coal-fired generating stations comprising 1,252 MW. PSEG Power has also announced the early retirement of its 383 MW coal unit in Bridgeport, Connecticut, in 2021.
Over the past few years and leading up to 2021, PSEG will have retired or exited through sales over 2,400 MW of coal-fired generation.
The 1,872-MW Conemaugh generating station went online beginning in 1970. The New Florence, Penn., plant has had multiple utility owners including Exelon, which sold its interest to ArcLight in 2014.
The 1,700-MW Keytone plant in Plumcreek Township started operations in 1967. In addition to PSEG, the owners include ArcLight Capital Partners, Reliant Energy, NRG and PPL.
About a decade ago, Reliant invested $375 million at Keystone and another plant to install scrubber systems to remove SO2.