NEWTON — Newton Mayor Mark Bolander said Wednesday that Dynegy Inc.'s announcement this week that it is shutting down one of the two units at the Newton Power Plant came as little surprise. About 50 jobs will be lost, according to a company official.
Bolander called last year's closure of a Dynegy plant in Wood River "a wake-up call."
"But we still have an uneven playing field," Bolander added. "There's just no way a deregulated coal-fired plant can compete with a regulated plant."
Ken Larimore, the University of Illinois Extension educator for the area that includes Jasper County, said the decision has been in the works for months.
"We have been in close contact with the Dynegy plant manager for months preparing for such an announcement," said Larimore, an economic development expert for the region.
Dynegy announced Tuesday that it was shutting down one unit at Newton and two units at the Baldwin plant in Randolph County. A news release said the plants could not cover their basic operating costs as a result of competition from plants that are better compensated through their states' regulatory process.
Dynegy spokesman David Onufer confirmed that nearly 50 jobs would be lost when the Newton unit is shut down within the next year. Micah Hirschfield, another Dynegy spokesman, added that the decision to scale down operations at Newton and at a Dynegy plant in the Randolph County village of Baldwin was not easy.
"It was very difficult, especially since these plants have been a part of the community for so long," Hirschfield said.
Newton powered up in 1977.
But Hirschfield said the plants slated to close have not been paying for themselves. That's not employees' fault, he emphasized. Instead, the inability of the plants to turn a profit has more to do with the Mid-Continent Independent System Operator, Inc. — the company that oversees high-voltage transmission — allowing excess power from other parts of their coverage area to flood the downstate market.
"What it breaks down to is the market design," Hirschfield said. "But we look forward to working with other stakeholders to remedy the problem."
Dynegy said in a news release that the Newton and Baldwin scaledowns, as well as the earlier shutdown of a plant in Wood River, means that about 30 percent of the downstate power generation capacity will be lost. Dynegy CEO Robert Flexon said in the release that Illinois state government needs to step in.
"Resolution of this issue in a way that serves Illinois as a whole can only be achieved with the immediate help and leadership of the Illinois state government," Flexon said.
Because Newton is a coal-fired plant, area legislators on both the state and federal levels blame Obama Administration policies on coal production and usage.
"The Obama administration's anti-coal, clean air policies are destroying jobs throughout our nation's coal country," said state Rep. David Reis, R-Ste. Marie, who predicted in a news release higher utility costs as a result of the scaledowns.
Reis added that he would be seeking a resolution through both state and federal officials.
"Going forward, I will be requesting a meeting between (Illinois) Attorney General Lisa Madigan, Dynegy and other interested parties to take immediate action on energy policy to protect Illinois jobs, generating capacity and economic benefits," Reis said. "In addition, I will be working with our congressional delegation to change the uncompetitive MISO auction process here in Illinois."
U.S. Rep. John Shimkus, R-Collinsville, said in his own news release that it's more than market forces that prompted Dynegy's decision.
"The heartbreaking trend of power plant shutdowns and mine closures across the country is not merely the result of market forces, but of a deliberate campaign by the environmental left to keep America's most abundant source of reliable electricity in the ground," Shimkus said.
Bolander called the scaledown "devastating for Jasper County." He also blames Democrat officeholders from President Barack Obama on down.
"We're very disappointed every time (Illinois House Speaker Michael) Madigan, Obama or Hillary (Clinton) gets behind a microphone to bad-mouth coal," the mayor said. "I would invite them to come down to one of the most pristine places in the state, right next door to the plant."
Larimore agreed with the mayor that the scaledown would be tough for the area to swallow in an economic sense.
"Stopping production in one of their two units will have a negative impact on regional employment, taxing bodies and the general economy," Larimore said. "We are doing all that is possible to minimize these negative effects."
Bill Grimes can be reached at firstname.lastname@example.org or 217-347-7151, x132.