Duke Energy Indiana, an affiliate of Duke Energy CorporationDUK ,announced that four additional environmental and consumer groups have supported a previous settlement regarding operating costs of its coal gasification plant at Edwardsport.
The original plea was filed after the plant's rising operating costs were being passed on to the local ratepayers and the plant was incapable of meeting performance targets.
The Citizens Action Coalition, the Sierra Club, Save the Valley and Valley Watch have lent support to the settlement, under which Duke Energy will absorb $87.5 million of the operating costs of the Edwardsport plant since it entered service in Jun 2013 and hence will not pass it on as higher rates to end users.
Additionally, Duke Energy has consented to cease burning coal at its Gallagher Generating Station in New Albany by 2022. Duke Energy has also agreed to allocate $500,000 to fund solar installations for the local community and to donate another $500,000 to a fund that provides assistance to Duke's needy customers.
The Edwardsport plant is a 618-Megawatt unit which used advanced technology to gasify coal and generate electricity from the cleaner gas, after filtering out the pollutants. This plant is a milestone in Duke Energy Indiana's broader plan of replacing aging coal-fired generation with a modern generation fleet, to curb emissions.
In the light of increasing regulatory pressure in the form of the Environmental Protection Agency's Clean Power Plan and the more recent Paris Climate pact, Duke Energy has been taking steady steps to reduce its carbon footprint. In the second quarter of 2015, the company announced the $1.1 billion Western Carolinas Modernization Project that included the early retirement of its Asheville coal plant. This coal plant will be replaced by a new 650 MW combined-cycle gas plant. The gas plant is expected to enter service by the end of 2019 and the entire project is likely to be completed by 2020.
Duke Energy currently has a Zacks Rank #3 (Hold). A few better-ranked stocks in the utility sector include Atlantic Power Corporation AT and Calpine Corp. CPN , sporting a Zacks Rank #1 and Black Hills Corporation BKH , carrying a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.