The proposed plans are in response to rising costs, and come after failed attempts to sell the property.
The company has notified 182 workers at the mine regarding the planned closure.
PacifiCorp Energy president and CEO Micheal Dunn said: "We have evaluated what is in the best interest of our customers and determined it no longer makes economic sense to keep the Deer Creek mine open.
"The new long-term coal supply agreement with Bowie will supply PacifiCorp with reasonably priced coal so we can continue to provide safe and reliable electric service to our customers."
Bowie Resource Partners will supply coal for the Huntington power plant from its mines in Utah.
The Deer Creek mine is said to host reserves of around five years with majority of the remaining coal containing higher ash and sulphur content.
