Consumers Energy to Buy Natural Gas Plant in Jackson

Natural gas combined cycle plant in Jackson, Mich.

Consumers Energy has opted to buy an existing combined cycle natural gas plant rather than build one now, a choice that will save Michigan customers about $500 million.

We reached a purchase agreement with an independent third party to buy a 540-megawatt combined cycle natural gas plant located in Jackson. The sale is expected to close in January 2016, helping offset a projected electric capacity shortfall created by the planned retirement of the “Classic Seven” coal plants in April 2016.

We also will withdraw a Certificate of Necessity filing for a proposed 700-megawatt generating plant in Thetford Township near Flint.

MLive Jackson Story      LIVE CHAT MLive 10 a.m. Jan. 30        

Buying an existing facility equipped with proven technology was the best solution to offset the projected 840-megawatt capacity shortfall created by the retirement of our smaller, aging coal facilities.

  • In addition to the purchase price savings, the Jackson plant — built in 2002 — provides efficiency, flexibility, and a high availability track record.
  • It also will allow us to continue to lower emissions and capitalize on today’s lower natural gas prices to provide customers with value.

We are deferring — not cancelling — plans to build the Thetford plant. Ultimately, we will determine whether developing the project is in customers’ best interests by weighing factors such as market demand, reliability factors, and pending energy policy decisions.

Deferring construction of the Thetford natural gas combined cycle power plant does not diminish our commitment to creating jobs in Michigan. We have pledged to increase spending by $1 billion with Michigan-based suppliers over five years as part of the Pure Michigan Business Connect (PMBC) initiative.

We continue to create up to 1,000 building trades jobs annually as work continues on environmental upgrades and ongoing maintenance at two of our larger coal-fired power plants. In addition, skilled trades will be needed to help dismantle the seven smaller coal-fired units we plan to retire. That dismantling process should start in 2017 and extend over several years.