Public Service Co. of Oklahoma plans to retire two coal-fired units at its Northeastern power plant in Oologah within the next 15 years in an agreement with the state and the Environmental Protection Agency over emissions.
The agreement will allow the utility, a unit of Ohio-based American Electric Power, to comply with EPA rules over haze and mercury and other air toxics. The company had claimed it would cost hundreds of millions to make the required upgrades to the coal units to come into compliance with the rules. Those costs likely would have been passed on to customers.
Under the proposed settlement agreement, PSO would meet specified emissions rates at both coal units. It would retire one unit by 2017 and install emissions control equipment at a second unit in preparation for retirement by 2025 or 2026.
The utility also has two natural-gas fired units at its Northeastern station. Together, the four units can power more than 1,780 megawatts of electricity.
“I am pleased that the parties could come to an agreement that is in Oklahoma's best interest,” said Governor Mary Fallin. “This agreement provides much needed certainty for PSO and its utility customers, ensures manageable and acceptable costs to consumers, transitions PSO's fleet to be cleaner and more efficient, and provides real environmental benefits for all Oklahomans.”
PSO said it would withdraw a pending lawsuit against the EPA over its regional haze rule.
"This landmark agreement outlines a clear and cost-effective path for compliance by PSO’s Oklahoma coal-fired generating units with the EPA’s new rules," said Stuart Solomon, PSO’s president and chief operating officer. "It allows PSO to implement a compliance plan that resolves the company’s most significant environmental issues, provides a manageable transition for our generation fleet, and assures continued reliability for our customers."