Pennsylvania town on the brink, as power plant shuts. What's the impact for the state?

HOMER CITY — Al Paratto would be hard-pressed to remember a time when the coal-burning power plant wasn't a fixture in his hometown.

In a few weeks, the Homer City Generating Station is set to close, marking a victory for the state's environmental enthusiasts and the beginning of an end for those who have depended on the jobs and the power of Pennsylvania's five coal plants. All are scheduled to shut down by 2028.

"We don't know any other way," Paratto, an employee of the Central Indiana County Water Authority, said during a break from grass-cutting at the Homer City Floodway Park. "Life is going to change."

Paratto spoke for his Indiana County community, but might well have been speaking for most of the Mid-Atlantic region, at the precipice between a tradition conflicted and a future uncertain.

By the end of June, the coal-fired Homer City Generating Station and its 2,000-megawatts of nameplate capacity are set to go dark for good. A pair of similar facilities, both less than 20 miles away, face the same fate within five years or less.

The prospective passing of these three western Pennsylvania plants — celebrated by climate change activists eager for a greener future — leaves the operator of America's largest regional transmission organization wondering how to avoid blackouts.

"We're struggling," Glen Thomas, president of the Pennsylvania-New Jersey-Maryland Interconnection Association, told Pennsylvania legislators in during a Senate Environmental Resources and Energy Committee briefing in Harrisburg on May 1. "We're in a tough spot right now, and we see some storm clouds on the horizon."

The Pennsylvania-New Jersey-Maryland Interconnection Association, better known as PJM, recently released a report projecting energy shortfalls within five years, as coal-fired plants shutter under the weight of increasing costs, decreasing payouts and tightening environmental regulations.

PJM operates the electric system in 13 states, plus the District of Columbia. About 65 million people live within this grid.

"If there aren't enough resources to meet the need," Thomas said, "we go into rolling brownouts."

Homer City: 'We have no alternative industry'

For the 6,000-plus residents of Homer City Borough and the surrounding Center Township, the Homer City power plant has been a constant for more than half a century.

Residents saw many coal mining jobs disappear by the '90s. Manufacturers — Thermo Fisher Scientific, Halliburton, FMC Technologies, among others — have also moved on.

The cumulative effect worries residents like Rob Walbeck, the third-generation owner of a local insurance agency.

"We have no alternative industry, and that's where we need help," he said.

"This impacts clear down to the local barber," he added, noting that the town is clinging to its last restaurant.

Fellow lifelong resident Shawn Steffee — executive board trustee for Boilermakers Local Lodge 154, which services the local plant and dozens of other sites across western Pennsylvania and eastern Ohio — is set to give the Homer Center School District commencement speech June 2. He wonders whether those kids will have the same high-paying regional job opportunities that he and his friends did.

"I could have gone anywhere I wanted," Steffee said.

"I grew up here. This is just where we want to be," he added. "At the end of the day, we love it."

The tax hit is another concern.

The power plant brings $720,780 in annual cash to the Homer-Center School District, according to business manager Gregg Kalemba. That's about 12% of the local real estate revenue.

"We don't know what will happen next," Kalemba said. "That's the big question: What? And when?"

NRG Energy, which operates the Homer City Generating Station through a subsidiary, announced in April that the plant is expected to shut down July 1. In a notice on file with the Pennsylvania Department of Labor & Industry, NRG said the plant's 129 employees will lose their jobs between July 3 and Oct. 16. The vast majority are members of Local 459 of the International Brotherhood of Electrical Workers, aka IBEW, headquartered in Johnstown.

Coal and limestone outfits across the commonwealth would be impacted as well, according to Pennsylvania Coal Alliance Executive Director Rachel Gleason.

"I think obviously they'd have to shift to other markets. The challenge with that is, of course, the transportation costs," Gleason said.

U.S. Energy Information Administration data suggests that Pennsylvania's coal-fired power plants are fed in-state by mines in several counties: Armstrong, Bedford, Cambria, Clearfield, Greene, Indiana, Jefferson, Mercer, Somerset and Westmoreland.

The demise of Pennsylvania plants like Homer City would jeopardize all but the largest of the mining outfits in the commonwealth, Gleason said. Coal-fueled plants in West Virginia, for example, are already in close proximity to existing mine operations.

"It definitely would be more of a challenge for these smaller operators," Gleason said.

To some, the plight of Homer City is part of the price of progress.

'We knew this day was coming'

Eliminating the mercury and greenhouse gas emissions from these sorts of power plants will be a net positive for the area, according to the Rev. Mitch Hescox, president and CEO of the Evangelical Environmental Network. The New Freedom pastor said medical studies show that children living near these operations are at higher risk of developing respiratory problems such as asthma.

"I think the reality is that, especially in the jobs market, we have to make a choice," Hescox said.

"Coal jobs are dying," he added. "Eventually natural gas jobs will go away."

A decision before the commonwealth's highest court would have a big impact on whether, or when, this transpires.

Last summer, Commonwealth Court judges granted a preliminary injunction to temporarily suspend Pennsylvania's entry to the multi-state Regional Greenhouse Gas Initiative, better known as RGGI. At issue is whether RGGI's carbon-pricing policy constitutes an unlawful tax if not first okayed by the state Legislature.

On May 24, Supreme Court of Pennsylvania justices expressed conflicting opinions about the question.

In the meantime, new Indiana County industries will be needed to offset the anticipated job losses, according to Homer City Borough Manager Rob Nymick.

"It's going to be harder to attract people here," Nymick said. "It's a declining population and an aging population."

Local politicians, he added, share some responsibility for the area's lack of diverse job options.

"Our elected officials have relied on coal and the power plant for many, many years. This isn't all the sudden," Nymick said. "But I'm going to have faith in our leadership; I have to have faith in them."

"We knew this day was coming," he added, "and I'm not 100% sure we've thoroughly prepared for this day."

Others wonder whether the grid is prepared for this day.

Pressure on power plants

Homer City's Indiana County is neighbored to the west by Armstrong County and to the east by Cambria County. All three are home to a coal-fired plant, comprising what's known to some in the industry as the "golden triangle."

The Keystone plant in Armstrong and the Conemaugh plant in Cambria are identical 1,700-megawatt generating stations operated by KeyCon LLC — and both will shut down by 2028, according to Chief Operating Officer Jim Locher.

Together, the Keystone and Conemaugh plants are capable of supplying nearly half of all Pennsylvania homes with power, Locher told senators at the recent grid reliability briefing in Harrisburg. Market uncertainties, including the commonwealth's pending entry to RGGI and additional federal environmental regulations, have put the industry under pressure.

"They're extreme," Locher said.

"RGGI would increase our production costs by over 33% today, and that cost, which would be in the hundreds of millions of dollars in additional expense, would immediately make our plants unviable ... and we would accelerate the closure," he added. "It's just not tenable."

Matt Barmack, vice president of market and regulatory policy at Calpine Corp., also participated in the Pennsylvania Senate briefing.

The owner of gas-fired plants in York and Bethlehem, Calpine has moved in recent years to shutter multiple gas-fired operations in California. Barmack said state regulators have stepped in to halt closures in some cases as Californians have suffered rolling power outages amid strains on the electrical grid.

"Obviously, it's easier to address the types of problems California has faced proactively rather than reactively," Barmack told Pennsylvania legislators, calling this a "tricky transitional period."

State Sen. Carolyn Comitta (D-Chester) agreed. The minority chair of the Senate Environmental Resources and Energy Committee characterized this period as the "great transition" from fossil fuels to cleaner sources.

"So it is, by necessity, going to be a turbulent and challenging time," Comitta said, "but also exciting for where we're headed."

Plants like Homer City are among the heaviest polluters within the energy grid, said Tom Schuster, president of the Sierra Club's Pennsylvania chapter. The Homer City Generating Station was the nation's largest single source of sulfur dioxide emissions until new scrubbers were installed a few years ago, contributing to haze, smog and acid rain, damaging trees and plant life.

"Transitioning away from coal is important in terms of our climate crisis," Schuster said.

In a 20-page report for the Sierra Club and Natural Resources Defense Council, energy consultants at Wilson Energy Economics offered a rebuttal to a recent PJM (Pennsylvania-New Jersey-Maryland Interconnection Association) study on grid reliability. Wilson Energy Economics was skeptical of PJM's suggestion that market forces won't prompt new energy sources to emerge quickly to replace the plants set to retire.

"It's an unrealistic, worst-case scenario," Schuster said.

The true challenge, according to Schuster, is one of PJM's own making: a logjam of interconnection queue applications. PJM has pledged to use a more streamlined process by 2026.

In a letter dated May 16, Pennsylvania Gov. Josh Shapiro called for PJM to accelerate its efforts.

"Delays in the interconnection queue are hampering our ability to bring new generation online in Pennsylvania," Shapiro wrote, "resulting in stranded investments and missed opportunities. PJM's commitment to speeding up the interconnection queue for critical projects is a welcome development, but I call on you to begin using this process today rather than in 2026, when PJM's current 2,700 application backlog has been cleared."

State Sen. Gene Yaw (R-Lycoming) expressed his doubts about whether renewables can carry the load either way.

Offsetting the retirement of the Homer City plant alone would require about 13,500 acres of solar panels, he said. Offsetting the retirement of the Keystone and Conemaugh plants would require an additional 23,800 acres. (An acre is roughly the size of a football field.)

"We're talking about 37,000 acres of solar panels to replace those plants," Yaw, the chair of the Senate Environmental Resources & Energy Committee, said during the recent briefing.

"Diversity is great," he added, "and I think that's the answer. But I'm not sure we're looking at some of these things realistically."

'Scares me to death'

With his union's work tied directly to plants like Homer City, Aric Baker was relieved by PJM's recent warning of power outages if fossil fuel plants retire too quickly.

"When (a blackout) happens here, it's gonna be in the winter," Baker said, citing peak demand when temperatures are coldest. "We haven't lived through it. That's the part that's not being advertised."

"This is the part that scares me to death because of what's going to happen," he added.

Baker's union, Local 459 IBEW, is seeing other attention as well. He said U.S. Sen. John Fetterman (D-Pa.) sent a representative to visit its Johnstown office a few weeks ago. U.S. Sen. Bob Casey (D-Pa.) had paid a visit in person the week before that.

"I'm not against solar, I'm not against wind," Baker said. "But the reality is you need plants like Homer City. Our grid is not going to be resilient anymore. It's not going to be dependable."

"Ninety-five percent of the time, gas is the answer," Baker added, "but that other 5% ... is death and destruction."

Thomas, on PJM's behalf, was only slightly more diplomatic.

"I think technology solves this problem," Thomas said, noting that scheduled plant retirements would mean that a fifth of existing generating capacity will be wiped out within a decade. "And our current technology isn't there."

He added: "We're going to be seeing reliability challenges if things don't change and we stay on our current trajectory."

Bruce Siwy is a reporter for the USA TODAY Network's Pennsylvania state capital bureau. He can be reached at bsiwy@gannett.com or on Twitter at @BruceSiwy.