HOUSTON--(BUSINESS WIRE)--Nov. 4, 2015--
Dynegy Inc. (NYSE: DYN) announced today plans to retire its 465 megawatt
(MW) Wood River Power Station in Alton, Illinois in mid-2016. The Wood
River Power Station includes two coal-fueled units that entered
commercial operation in 1954 and 1964, respectively.
The decision to retire the Wood River facility is due to its uneconomic
operation stemming from a poorly designed wholesale capacity market in
Central and Southern Illinois that does not allow competitive generators
to recover costs. The current market design of the Midcontinent
Independent System Operator, Inc. (MISO) capacity auction is flawed
because it allows regulated utilities from surrounding states to bid
their capacity into the auction at little to no cost as these regulated
utilities receive higher guaranteed compensation from their respective
state-regulated markets. Central and Southern Illinois market
participants, on the other hand, operate in a state with a deregulated
competitive framework and must rely on the MISO capacity auction for
fair compensation, unlike their regulated counterparts. Mixing these two
regulatory regimes together in the same capacity auction puts all
generating units in Central and Southern Illinois at financial risk,
regardless of fuel type, shifting jobs and the economic benefits of
hosting generating plants from Central and Southern Illinois to
neighboring states.
“I would like to thank the men and women who have proudly and
professionally served and safely operated the Wood River facility for
decades,” said Robert C. Flexon, president and CEO of Dynegy. “Wood
River has been an important part of the local community for many years
providing safe, reliable, and cost effective power while also being a
responsible corporate citizen.”
“Dynegy is committed to working with MISO, the state of Illinois, Union
leadership and all stakeholders to redesign the MISO capacity market to
one that properly functions and fairly compensates competitive
generators or alternatively, to transition Illinois fully into PJM.
Otherwise, all generating plants in the MISO portion of Illinois will
face a future of financial challenge. If Wood River was located in the
PJM market, like Dynegy’s Northern Illinois generating units, it is
unlikely this retirement would be occurring,” added Flexon.
Dynegy expects to formally file a retirement notice with MISO by
December 1, 2015. This retirement notice will trigger a reliability
review by MISO, which the Company expects to be completed in the first
quarter of 2016. If MISO determines the plant is not needed for
reliability, Dynegy expects the retirement to occur in mid-2016.
Dynegy will be developing plans to minimize the impact on the
approximately 90 employees at Wood River where possible, and to
terminate operations in a safe and environmentally responsible manner.
The Company will work with all of the relevant state, local, and
community stakeholders to address the impact of the retirement of Wood
River.
About Dynegy
We are committed to leadership in the electricity sector. With nearly
26,000 megawatts of power generation capacity and two retail electricity
companies, Dynegy is capable of supplying 21 million homes with safe,
reliable and economic energy. Homefield Energy and Dynegy Energy
Services are retail electricity providers serving businesses and
residents in Illinois, Ohio and Pennsylvania.
Forward Looking Statements
This press release contains statements reflecting assumptions,
expectations, projections, intentions or beliefs about future events
that are intended as “forward-looking statements,” particularly those
statements concerning timeline and scope of the MISO retirement notice;
outcome of the MISO reliability review; and Dynegy’s anticipated impacts
and expected timing and manner of retirement. Discussion of risks and
uncertainties that could cause actual results to differ materially from
current projections, forecasts, estimates and expectations of Dynegy is
contained in its filings with the Securities and Exchange Commission
(the “SEC”). Specifically, Dynegy makes reference to, and incorporates
herein by reference, the section entitled “Risk Factors” in its 2014
Form 10-K and subsequent Form 10-Qs. In addition to the risks and
uncertainties set forth in Dynegy’s SEC filings, the forward-looking
statements described in this press release could be affected by, among
other things, (i) Dynegy’s ability to retire the facility by mid-2016;
(ii) Dynegy’s anticipated benefits associated with the Wood River
facility retirement (iii) expectations about the outcome of regulatory,
administrative and legislative matters; (iv) the impacts on the scope
and timing of any potential negotiations or the outcome of any legal
processes; (v) the effects of, or changes to, MISO or PJM power and
capacity procurement processes; (vi) expectations and estimates
regarding capital and retirement expenditures; and (vii) Dynegy may be
adversely affected by other economic, business, and/or competitive
factors. Any or all of Dynegy’s forward-looking statements may turn out
to be wrong. They can be affected by inaccurate assumptions or by known
or unknown risks, uncertainties and other factors, many of which are
beyond Dynegy’s control.
View source version on businesswire.com: http://www.businesswire.com/news/home/20151104006845/en/
Source: Dynegy Inc.
Dynegy Inc.
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Micah Hirschfield, 713.767.5800
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