Dynegy Inc. announced 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," Dynegy claimed

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.

Tags:
Dynegy   MISO   Illinois   Capacity Market  

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