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Apr 12, 2012 10:54 AM by AP

Plan shelved to convert power plant to coal

BATON ROUGE, La. (AP) - Low natural gas prices and plentiful gas supplies have put aside plans to convert a gas-fired power plant to New Roads to coal power.

NRG Energy Inc. spokesman Dave Knox told The Advocate that the company has allowed a state permit to convert the Big Cajun I plant to coal to expire. On Wednesday, U.S. natural gas prices fell below $2 per 1,000 cubic feet for the first time in more than a decade.

Big Cajun I, which produces 230 megawatts of power, never received a federal permit to convert to coal. It is one of five power plants operated by Louisiana Generating, an NRG Energy subsidiary.

Another power plant operated by Louisiana Generating in New Roads, Big Cajun II, is the company's only coal-fired plant in Louisiana.

"With the price of natural gas falling to what it has, the economics just weren't there for making a conversion," Knox said.

NRG Energy proposed converting Big Cajun I to coal during a time when natural gas prices were high. In recent years, huge shale finds have resulted in skyrocketing supplies - and the lowest gas prices seen in years.

The proposal to convert to coal had drawn criticism from environmentalists, who said emissions would affect air quality in the Baton Rouge area. Marylee Orr, executive director of the Louisiana Environmental Action Network, said popular fishing spots in southern Louisiana have been contaminated by mercury, which she said comes primarily from coal-fired generating plants.

Knox said he could not say exactly what the cost comparison is between coal and natural gas since so much of the price is linked to transportation costs.

In 2009, NRG Energy contemplated burning biomass such as switchgrass and sorgham along with coal at Big Cajun II. But the crops yielded only a fraction of the expected biomass.

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