Washington state utility company calls off sale of coal plant shares

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Puget Sound Energy has called off the sale of a major coal plant after years-long negotiations fell through, company officials reported on Thursday.

The Washington utility company announced in December that it intended to sell a 25% stake in Unit 4 of Montana’s Colstrip Power Plant to NorthWestern Energy and Talen Energy.

PSE would have been responsible for buying back electricity from the companies for the next five years at an inflated rate while remaining liable for any future clean up costs.

Talen Energy was in months-long negotiations with PSE to buy 50% of PSE’s share of the plant and maintained a right of refusal under the deal. The deal was further complicated by Talen and NorthWestern’s competing interests in buying portions of the Colstrip Transmission Line.

PSE had requested just last week that the Washington Utility and Transportation Commission to put a raincheck on the proceedings while arbitration continued.

The sale drew criticism from the Washington Utilities and Transportation Commission along with the Washington Public Counsel on the grounds that it did not offer any discernible benefit to PGE customers.

PSE Director of Generation and Natural Gas Storage Ron Roberts said in a written statement that the company was “deeply disappointed” with the development, but remains determined to remove coal from its portfolio by the state’s deadline.

Colstrip Power Plant is owned by the five regulated utility companies: PSE, NorthWestern Energy, PGE, Avista and PacifiCorp.

Under Washington’s Clean Energy Transformation Act, all electric utilities must eliminate 100% of their greenhouse gas emissions by 2045.

Earlier this year, the Colstrip’s aging Units 3 and 4 were retired in response to rising operating costs shared by much of the utility industry.

Thursday’s announcement now leaves the future of the plant in doubt and transition leaves its 330 workers in limbo.

PSE devoted around $350 million for cleanup costs and another $13 million for an eventual transition.

Environmentalist groups have long called for the company to move away from fossil fuels, but expressed concern about the future of PSE’s work force in light of Thursday’s news.

“Delaying the inevitable closure of the plant puts the community at risk of sudden, chaotic job losses,” said the Sierra Club’s Senior Campaign Representative Doug Howell. “It’s time for Colstrip’s owners to work together to guide the plant towards an orderly transition that takes care of workers and cleans up the decades of toxic coal ash pollution in the community.”

The development at Colstrip marks the second time that a Pacific Northwestern company has made moves to exit the coal industry this month after Oregon’s last coal plant shut down two weeks ago.

PSE provides electricity to more than one million customers across the state and natural gas to another 750,000 customers.

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