MDU Resources Group, Inc., subsidiary Montana-Dakota Utilities, announced that it intends to retire three aging coal-fired electric generation units, including one at Sidney, Montana, and construction new simple-cycle natural gas combustion turbine, within the next two to three years.
The news comes as part of the company’s resource plan (IRP), which it puts together every two years to meet filing requirements of regulatory agencies. The shift to natural gas combustion turbine is being made to better meet the competition of low-cost power available on the market, due to low-cost natural gas and the increasing supply of subsidized wind resources. Other reasons include the rising cost of operating the aging facilities.
The retirements are expected around the end of 2020 for Lewis & Clark Station in Sidney, and around the end of 2021 for units 1 and 2 at Heskett Station in Mandan, N.D. These dates may be impacted by the company’s coal supplier’s pending bankruptcy proceeding.
Montana-Dakota will probably have to hire ten more employees in addition to the 77 people currently hired between the two coal stations.
The company has begun the process to construct an 88-megawatt simple-cycle peaking unit at the Heskett Station site.
The new generation resource was selected as part of Montana-Dakota’s IRP. The company believes a second combustion turbine at Heskett will be cost-effective because the site has existing infrastructure and natural gas supply that serves an existing combustion unit that went online in 2014.
The first coal-fired unit at Heskett went online in 1954 and the second unit in 1963. They combine for 100 MW of power.