Louisiana Generating, a business wing of Princeton utility
NRG Energy Inc.
), announced that it will carry on with its emission cutback
plans at its Big Cajun II Electrical generating facility in
Louisiana. The cost involved in upgrading the facility is well
within NRG Energy's targeted capital spending plans. These
measures will enable the company to continue providing affordable
power services to customers in the region.
The decision to reduce emission levels came in the wake of the
government's Mercuric Air Toxics Standards (MATS) which comes
into effect from April 2015. Louisiana Generating will switch one
of its coal-fired plants to natural gas resulting in the removal
of mercury and particulate emissions from the unit.
Apart from resolving the issues related to the charges by the
Environmental Protection Agency ("EPA") and Louisiana Department
of Quality, the company plans to install Selective Non-Catalytic
Reduction ("SNCR") control equipment to diminish nitrogen oxide
on all three units and the sought after Dry Sorbent Injection
technology on Unit 1 to slash sulfur dioxide discharge. The
company also intends to install activated carbon injection in one
unit and upgrade the electro precipitators.
The company initiated its modernization program by modifying
the burners and fuel which led to reduction in nitrogen dioxide
(NOx) and sulphur dioxide (SO2) emissions after the purchase of
the Big Cajun facility by a third. The coal-to-gas switching and
other technological upgrades are expected to be completed by 2015
taking into account scheduled outages.
NRG Energy will continue to pursue its pro-environment
objectives at the Big Cajun facility and at the same time provide
clean as well as low-cost services which will help the company in
securing its existing customer base. Moreover, conversion to
natural gas energy source will bode well with NRG Energy's future
The Zacks Consensus Estimates for the fourth quarter and full
year 2012 currently stand at 13 cents and 82 cents per share,
The company's northeast operations were hit by Hurricane Sandy
which caused damages to power infrastructures and exacerbated
costs. We believe this will put pressure on margins in the
upcoming quarters. However, NRG Energy's recent 11-year contract
extension for power supply to a Washington-based electric
co-operative could provide some relief. Given the pros and cons,
the company in the short term retains a Zacks #3 Rank (Hold
Another utility player presently having a short-term Zacks #3
Rank (Hold rating) is Virginia-based
The AES Corporation
We believe the installation of these new emission control
equipment would prove to be more economical than scrapping the
units altogether and building new generation units.
New Jersey-based NRG Energy Inc. is a wholesale power
generation company engaged in the ownership, development,
construction, and operation of power generation facilities. With
a market capitalization of $4.52 billion, the company has 5,193
AES CORP (AES): Free Stock Analysis Report
NRG ENERGY INC (NRG): Free Stock Analysis
To read this article on Zacks.com click here.