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Second gas plant proposed for northwest Ohio

July 11, 2016

The developer of an 800-MW natural gas plant under construction in northwest Ohio may build a "carbon copy" facility at the site to help offset retiring coal-fired generation in the region, the company's top executive said Wednesday.

CME Energy's new Oregon Clean Energy combined-cycle plant should be operational by June 1, 2017, in time to supply PJM Interconnection, a regional grid operator, William Martin, president of the Boston-based company, said in an interview.

The plant's scheduled completion date "coincides when capacity payments start" from PJM, he said. "The first fire will probably be in April [2017]. We cleared the PJM auction for the 2017-2018 planning year."

Black & Veatch, the engineering, procurement and construction contractor, began work on the $900 million project last November. Energy Investors Fund and I-Squared Capital are majority owners of Oregon with CME maintaining a minority interest.

With the project still nearly two years from completion, Martin, a veteran US energy industry executive, nevertheless is hard at work on a second gas plant at Oregon's location near Toledo.

"We'll probably expand it and build a second project there," he said. "We're doing a study of the grid now" to determine the ideal size for the second plant.

"Ideally, it would be a carbon copy," he said. "We have to study the grid and some ancillary issues, but it will be a good-sized combined-cycle plant."

Martin, who has developed power projects both domestically and internationally during his lengthy career, admits to being "bullish" about the need for additional generation in PJM to counter the spate of coal plant closings mainly for environmental reasons.

In Ohio alone, FirstEnergy and American Electric Power have shuttered more than 5,000 MW of older baseload coal generation during the past year.

As a result, "We think there's going to be a continued need out there" for new generation "and continued pricing to support it," said Martin, who also is building a 230-MW gas-fired peaking plant in Rhode Island.

He added: "I think PJM and New England ISO and maybe New York will continue to see development through the next five years. But there's a market there now" and it should continue for the foreseeable future.

Last week, FirstEnergy's American Transmission Systems Inc. subsidiary asked the Ohio Power Siting Board to approve the $2.4 million construction of two 0.2-mile transmission lines to connect Oregon to the grid.

FirstEnergy spokesman Doug Colafella said Wednesday the company hopes to start construction in October, with completion targeted for May 30, 2016.

Wolverine to begin building 432-MW gas plant
In neighboring Michigan, Wolverine Power Cooperative plans to begin foundation work this month on its 432-MW Alpine Energy Center gas-fired peaking plant in Otsego County after receiving a final air permit from the Michigan Department of Environmental Quality.

"We essentially started moving ground in early spring" in preparation for the foundation work, said Kimberly Molitor, spokeswoman for the Cadillac-based generation and transmission co-op.

Wolverine is finishing up a transmission interconnection agreement with the Midcontinent Independent System Operator, another regional grid operator.

The plant is scheduled to be in commercial operation in 2016 "and will be ready for the 2016-17 planning year," she said.

Wolverine decided to construct Alpine after it pulled out of a tentative agreement two years ago to acquire a stake in We Energies' 431-MW Presque Isle baseload coal plant in Michigan's Upper Peninsula.