Sierra Club Secures Cleco Commitment to Replace Uneconomic Coal-Burning Generation and build Clean Energy

Louisiana Public Service Commission approves Cleco’s acquisition of NRG’s Louisiana wholesale generation portfolio including  commitments to retire or reduce uneconomic coal-burning generation and add more in-state renewable energy than any utility in Louisiana

BATON ROUGE, LA - Today, Sierra Club secured Cleco’s commitment to phase out coal use and reduce the operation of 1,200 MW of uneconomic coal-burning generation and to acquire 200 MW of renewable energy--with a goal of achieving 30% renewables, fleet-wide--as part of a multi-party settlement approving Cleco’s $1 billion purchase of NRG’s Louisiana wholesale generation business. Cleco also committed to holding ratepayers harmless for the costs of cleaning up years of dangerous coal ash waste accumulation at Big Cajun II.

The Louisiana Public Service Commission’s approval of the transaction represents a significant step toward reducing Cleco Power customer’s electricity costs, while also reducing pollution and creating clean and sustainable jobs that harness Louisiana’s abundant renewable energy potential. The decision puts Cleco Power on the path to having more in-state renewable energy than any other Louisiana utility, and it will save Cleco Power ratepayers approximately $40 million annually.

As initially proposed, Cleco planned to incur significant additional debt to purchase from NRG several increasingly uneconomic and obsolete fossil-fuel burning power plants. That debt created significant financial risk for Cleco Power and its ratepayers. If Cleco’s assumptions about the value of the NRG the power plants were wrong, the transaction would have impaired the Company’s ability to finance necessary system improvements, meet environmental obligations, and reliably serve customer needs at the lowest price. To mitigate those risks, Sierra Club submitted extensive expert testimony demonstrating that retiring and replacing some of Cleco’s uneconomic coal-burning generation would improve the economics of the proposed transaction and reduce overall costs to Cleco Power ratepayers.  

To address those concerns, Cleco agreed to stop burning coal at the 580 MW Big Cajun II, Unit 1 plant by 2025, to immediately reduce the operation of the Dolet Hills coal plant to operate only in the summer months, and to add 200 MW of renewable energy in Louisiana, with a goal of achieving 30% renewable energy, fleet-wide.  The transaction also includes protections for ratepayers against the costs of cleaning up harmful coal ash waste at Big Cajun II. With the Louisiana Public Service Commission’s approval of the settlement with Sierra Club, Cleco Power takes a big step towards reducing pollution, creating sustainable clean energy jobs, and transitioning to a clean energy future while also reducing customer bills.

In response Sierra Club’s Beyond Coal Campaign Representative Cherelle Blazer released the following statement:

“Sierra Club’s settlement approved as part of today’s Cleco-NRG merger ensures less coal and more clean energy in Louisiana. The settlement requirement for renewables just increased clean energy by 200 MW for Cleco’s customers. This is an important step in ensuring Louisiana’s power grid transitions to clean energy from fossil fuels“

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