COLUMBUS, Ohio (AP) — American Electric Power said Thursday that it plans to retire a fifth coal-fueled power plant in Ohio, citing environmental compliance costs and tough market conditions.
Under a deal reached in February, AEP had the option to retire the 585-megawatt Muskingum River Plant Unit 5 in Beverly, Ohio, or refuel it with natural gas. But as a result of the costs and market conditions, AEP said it probably won't spend the money to refuel the unit.
The company has already announced plans to retire units one through four at Muskingum River by the end of 2015.
About 95 employees working at the five units will be affected. AEP said it will work to provide displaced workers with jobs at other AEP facilities and consider those who don't find new positions with the company for severance benefits.
As a result of the move, AEP said it will record a pretax impairment charge of $150 million to $170 million in the second quarter.
The company said the decision won't affect its previous 2013 operating earnings outlook of $3.05 to $3.25 per share. And the company still expects its profits to grow at a rate of 4 percent to 6 percent based on that guidance.
AEP previously announced plans to retire 2,538 MW of coal-fueled power plants in Ohio and West Virginia by the end of 2015. Monday's addition of the fifth unit at Muskingum River brings that total to 3,123 megawatts.
The remaining 10,725 megawatts of generation owned by the company's Ohio subsidiary will consist mostly of low-emitting, coal-fueled plants; natural gas-fueled combined cycle and combustion turbines; and a small hydro plant, AEP said.
AEP shares rose 41 cents to $45.83 in morning trading.