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Guest opinion: GOP ignores market reality in spinning Corette story

By: MITCH TROPILA |

Pennsylvania Power and Light’s announcement of the closure in 2015 of the Corette coal-fired power plant in Billings has fueled a preposterous blame game. The timing is glaringly obvious — just weeks before an election.

Is it a coincidence that within days of the announcement Rep. Dennis Rehberg had TV ads blaming Sen. Jon Tester for the eventual closure? No. Is it a lack of understanding energy and job markets that has Steve Daines blaming government regulations for the closure? Yes. Is it his time in Washington that directs Rick Hill to cozy up to Big Business? Likely.

The reality of Corette’s closure is that coal plants all over the country are feeling the pinch from one of the biggest natural gas booms in the nation’s history. Last May, PPL announced it was replacing some of its older Kentucky coal plants with natural gas plants. Last month’s Wall Street Journal article, “Coal-Fired Plants Mothballed by Gas Glut,” featured PPL as one of many companies nationwide that is considering sidelining coal plants as a result of low natural gas prices.

Coal has a hard time competing in the modern market. Demand is down for electricity in general and in particular for coal-fired electricity. In 1985, coal accounted for 57 percent of all power generated in the U.S. Last year it dropped to 42 percent. In the first quarter of this year, it was down to just 36 percent.

In its August filing with the Securities and Exchange Commission, PPL reported its current market conditions as follows: “Current depressed wholesale market prices for electricity and natural gas have resulted from general weak economic conditions and other factors, including the impact of expanded domestic shale gas development.”

Predictably, instead of blaming market conditions and natural gas for Corette’s closure, PPL blames wind energy and federal regulations. Montana has seen a renaissance of wind energy and has seen the addition of 131 megawatts of coal generation, 337 MW of natural gas and 45 MW of hydroelectric power. These projects translate to jobs and revenues for communities across the state. It is not difficult to understand why a 44-year-old 153 MW coal plant might have a hard time competing in a competitive and dynamic market.

Last year PPL reported profits of $1.5 billion and paid its CEO $12 million, yet stated that federal regulations for toxic air emissions were going to be too costly. These regulations have been in the works for decades.

PPL is playing political games and pointing fingers while making business decisions based on market conditions. An outdated coal plant is having a tough time competing in the modern energy market.

Rehberg, Daines and Hill have resorted to untruthful politics as usual.