The Michigan utility said that it is deferring, not canceling, the development of the new unit because of reduced customer demand for electricity due to the recession, forecasted lower natural gas prices due to recent developments in shale gas recovery technology, and projected surplus generating capacity in the Midwest market.
The company had earlier revealed its plans in 2007 to build an clean coal unit at its Karn/Weadock generating complex near Bay city, Michigan. It received an air permit for the project in December.
The company said that it will monitor customer demand, fuel and power prices, and other market conditions, but has set no timetable for a future decision about the project.
John Russell, president and CEO of CMS Energy and Consumers Energy, said: “The company remains committed to its Balanced Energy Initiative and maintaining a balanced portfolio of energy resources to serve its customers. That portfolio is based on existing generating plants and market purchases, increased renewable energy resources, and energy efficiency.
“The company also remains committed to its growing forward strategy, which calls for investing approximately $7bn in its electric and natural gas utility operations over the next five years.
He added, “The new clean coal unit made up about $1bn of that five-year total and the company expects to make other investments in place of the coal plant.”
