LOUISA, Ky. (WSAZ) -- The Kentucky Public Service Commission (PSC) has given its final approval to Kentucky Power’s plan to convert one of the two coal-fired electricity generating units at the Big Sandy Power Plant to natural gas.
The decision does not affect plans to close Unit 2 by June 1, 2015.
Unit 1 is being converted from coal to gas to meet stricter federal air quality requirements to reduce emissions of mercury and other toxics. Without the conversion, the unit would have to be shut down in April 2015.
Kentucky Power said it made no economic sense to retrofit the 50-year-old Big Sandy Unit 1 to meet the stricter standards in order to continue burning coal.
At a cost of $50 million, the coal-to-gas conversion of Big Sandy Unit 1 proved to be the most reasonable and lowest-cost option, and will have the lowest impact on rates, the PSC said.
The plan also calls for the construction of a natural gas pipeline to serve the facility.
Columbia Gas Transmission will build and operate the pipeline and will recover the $49 million cost from Kentucky Power over a 15-year period
Kentucky Power President and CEO,Greg Pauley says, " We are pleased that we will be able to retain employees at the plant. Although fewer employees will be needed to operate the unit once it is converted."
Pauley says the number of employes who will retained will determined in coming months.
Kentucky Power says roughly 300 temporary workers will be needed to complete the conversion and construct the pipeline.