LG&E, KU receive approval for large portion of investment plan
PPL subsidiaries Louisville Gas and Electric Company (LG&E) and Kentucky Utilities Company (KU) said on Monday they had received regulatory approval for a substantial portion of its investment plan.
The approvals covered the utilities’ plan to retire 600 MW of coal generation and more than 50 MW of aging peaking units by 2027, and to replace them with an affordable, reliable and cleaner energy mix.
The approvals from the Kentucky Public Service Commission (KPSC) authorized the two utilities to build one combined-cycle natural gas plant of about 640 MW, add 240 MW of company-owned solar, secure power purchase agreements for nearly 650 MW of additional solar, construct 125 MW of battery storage and implement more than a dozen new energy efficiency programs. KPSC also approved Allowance for Funds Used During Construction (AFUDC) treatment for all of the authorized projects.
“We appreciate the KPSC’s comprehensive review of our generation replacement plan,” said PPL President and Chief Executive Officer Vincent Sorgi. “While the KPSC did not approve our entire request, which we believe offered the best and least-cost approach for our customers, the decision will ensure we can continue to reliably meet our customers’ future energy needs, further diversify our Kentucky generation, advance a cleaner energy mix and support the state’s continued growth and economic development.”
The KPSC deferred the retirement of two of the four aging coal units the two companies sought to retire due to the uncertainty around pending environmental regulations. KPSC also denied the company’s request to build a second combined-cycle gas plant, finding that construction of the second unit should provide an in-service date of 2030, rather than 2028 as proposed.
PPL said the level of expected investment is consistent with the originally proposed generation replacement plan, projected at $2.1 billion of investment overall, including $1.6 billion through 2026. The investment is expected to include additional costs related to construction and investments needed to continue operating and maintaining the two units KPSC deferred retirement of.
