Mirant defends shutting Potomac River

Washington (Platts)--6Sep2005

As Mirant's Potomac River generating station remained closed for the second
week and advocates for and against its closure petitioned federal authorities
to intervene, Mirant defended its decision to temporarily shut down the
facility. 

"Mirant has a responsibility to deliver power to support the reliability of
the electric grid, but it must also respect public health concerns. Given the
short time we had to find a solution that satisfied the [Virginia Dept. of
Environmental Quality], we did what any responsible company would do. Now
we're looking to the appropriate federal authorities to tell us to either keep
the plant shut down or return it to operation," said Marce Fuller, Mirant
president and CEO.

Fuller said "the plant remains fully staffed and in a state of operational
readiness." She said the company is "ready to continue discussions with all
parties to reach a short- and long-term solution that satisfies [National
Ambient Air Quality Standards] and returns the plant to operation as soon as
possible."

Fuller also denied that Mirant shut the plant for financial reasons. The
company filed for Chapter 11 bankruptcy protection in 2003. The filing
includes Mirant Corp., Mirant Americas Generation LLC and substantially all of
the companies' US subsidiaries. 

"Statements that Mirant temporarily shut down its plant for economic reasons
are absolutely false. This is peak season for all power companies, and having
this plant shut down is costing us money," Fuller said.

A Platts coal analyst agreed with Fuller. "Closing that plant is costing
Mirant money," he said. 

"Our electricity model showed that Potomac River should stay open. It's
financially viable for the company." Platts Electricity Market models forecast
how plants will dispatch in the future. 

The analyst said there are no national implications to the plant closing and
that the shutdown was strictly driven by the need to meet state emission
standards. He did say that the logical consequence of the shutdown could be
increased power prices because, in this situation, you have two choices: Add
pollution control equipment, which is expensive, or switch from coal to
another energy source.

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