By St. Louis Business Journal

Ameren Corp. said today it will close two of its coal and oil plants in Illinois by the end of the year, affecting 90 workers, because of new costly pollution regulations.

The Meredosia and Hutsonville plants are part of Ameren Energy Generating Co., an Ameren subsidiary that invested $27 million in the plants as of June 30.

Severance and closure costs are still being determined, Ameren said.

⿿We are working to provide alternative employment opportunities and reassignments within (Ameren Energy Generating) for many of the 22 management and 68 union-represented employees affected by these decisions,⿝ said Steven Sullivan, president and chief executive of Ameren Energy Generating. ⿿It is my sincere hope that any employee desiring a reassignment opportunity can be accommodated.⿝

Positions affected include 14 management and 39 union-represented employees at Meredosia Energy Center and eight management and 29 union-represented employees at Hutsonville Energy Center.

Ameren had wanted to sell some of its coal-fired plants in Illinois.

Ameren said it had to close the facilities because it couldnâ¿¿t afford to comply with cross-state air pollution rules the U.S. Environmental Protection Agency issued in July. The regulations require reductions in sulfur dioxide by 73 percent and nitrogen oxide by 54 percent from 2005 levels.

The new rule ⿿tightens the restrictions on SO2 and NOx emissions to the point that we cannot continue to economically operate these units,⿝ Sullivan said. ⿿Numerous options to bring these units into compliance were explored, including installing additional environmental controls, but the costs were just too high to be justified.⿝

Another factor driving the closure of operations at these facilities is a lack of a multi-year capacity market managed by the Midwest Independent Transmission System Operator (MISO), Ameren said. ⿿Without the ability to sell capacity several years out, we cannot afford to make the substantial investment for environmental controls that would be required to keep these units in service,⿝ said Sullivan. ⿿I suspect that MISO⿿s proposed capacity construct, recently filed with the Federal Energy Regulatory Commission, will lead to the closure of additional non-AER merchant plants in the Midwest over the next few years unless the proposal is significantly modified.⿝

The Meredosia Energy Center is still the proposed site for a new coal-fired FutureGen plant that will capture and store of carbon dioxide. Last year, Ameren and the FutureGen Alliance signed a $553 million cooperative agreement with the U.S. Department of Energy that could lead to repowering the Meredosia plant.

St. Louis-based Ameren Corp. (NYE: AEE) serves 2.4 million electric customers and nearly 1 million natural gas customers through its Missouri and Illinois subsidiaries.

Follow Kelsey Volkmann on Twitter @KelseyVolkmann.

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