Entergy CEO says future holds no new coal plants

Entergy Corp. doesn't expect to build any new coal-fired power plants, its chairman and chief executive officer said in an interview Friday after the New Orleans-based utility completed its annual shareholders meeting in Little Rock.

Even before the change in presidential administrations, Energy had not planned to build another coal plant, Leo Denault said. Environmental Protection Agency administrator Scott Pruitt has said that the regulatory assault on coal is over.

"Our desire is to be an environmentally responsible company," Denault said. "Whatever the administration does, that doesn't change our point of view."

Entergy operates two coal plants in Arkansas -- White Bluff, a 932-megawatt plant in Redfield, and Independence, a 683-megawatt plant in Newark. White Bluff began operations in 1980 and Independence in 1983.

The utility operates two other coal plants in Louisiana that are also about 35 years old.

It's unlikely that "significant environmental modifications" would be done at the Arkansas plants, Denault said.

"It would be much more efficient from a reliability standpoint, from a capital standpoint and an environmental standpoint [to use natural gas]," said Denault, who was paid more than $9 million last year as Entergy's chairman and chief executive officer.

Cleaning the Arkansas coal plants would be costly, said Rick Riley, chief executive officer of Entergy Arkansas Inc.

"We are putting low [nitrogen oxide] burners on those units to reduce the nitrogen oxide component of the emissions," Riley said. "But in order to reduce the sulfur dioxide, we would have to scrub those units. When you add the costs to scrub both the White Bluff and Independence plants, it would be about $2 billion for assets that would be about 50 years old at the end of the next decade."

Given the uncertainty of the regulatory environment for coal plants, it isn't surprising that Entergy would have no plans to build other coal plants, said John Bethel, executive director of the Arkansas Public Service Commission's general staff.

"That's not a unique decision," Bethel said.

Entergy Arkansas announced last year it had made the decision to discontinue burning coal at White Bluff in the future, Bethel said. The announcement didn't mean Entergy would stop burning coal immediately at White Bluff, but at some point in the future, Bethel said.

Only four months after it began operations, the $1.3 billion Big River Steel plant near Osceola is already Entergy Arkansas' largest user of electricity, Riley said. The plant is the biggest economic development project ever built in Arkansas.

When it builds the second phase of its plant, Big River Steel will be the largest user of electricity in Entergy Corp.'s four-state territory, Riley said. Big River Steel has said that its second phase would double its capacity.

"One of the reasons they located in our service territory is because our [electricity] rates are 20 percent below the national average," Riley said.

Two other large users of electricity in the state are two Nucor Corp. steel plants in Mississippi County, near Blytheville. Mississippi County Electric Cooperative and Arkansas Electric Cooperative Corp. supply the electricity to those plants, Bethel said.

Entergy rotates its annual shareholders meeting among the states where it provides electricity -- Arkansas, Louisiana, Mississippi and Texas. Friday's meeting was held at the Statehouse Convention Center in Little Rock.

Entergy has about 705,000 customers in Arkansas and more than 3,500 employees.

Business on 05/06/2017