Ameren Missouri appears to be making good on a two-year-old announcement to close its Rush Island coal plant, which has racked up multiple Clean Air Act violations over the years.

Last week, Ameren Missouri filed for permission with the Missouri Public Service Commission to use securitization to finance the closure of the plant through ratepayers (EF-2024-0021). The utility said it wants to wind down operations by mid-October next year to avoid installing sulfur dioxide scrubbers per a court order.

The financing option Ameren seeks is possible through a two-year-old Missouri law that allows utilities to securitize outstanding debt on their facilities to further the energy transition. If approved, Ameren would be free of Rush Island debt and free to invest in other generation, while investors paying the bonds would be guaranteed a return of 2% to 4%. The securitization would result in a new line item on monthly bills of $1.71 for the average residential customer for the next 15 years.

Ameren estimates it has more than $475 million of undepreciated investment in Rush Island today.

Despite the request for ratepayer-backed bonds to recoup plant investment, Ameren pledged customer bills would decrease with the earlier-than-anticipated retirement. It estimated customers would save $120 million over 15 years.

In its filing, Ameren said “costs of securitization are lower than traditional ratemaking” and concluded that “retirement of Rush Island instead of retrofitting the plant with expensive pollution control equipment is clearly in customers’ best interest.”

In testimony to the Missouri PSC, Ameren Missouri President Mark Birk said by the time the order from the U.S. District Court for the Eastern District of Missouri to scrub Rush Island became final, “circumstances had made the continued operation of coal-fired plants extremely challenging.”

He said EPA’s proposal to limit carbon emissions from existing coal plants poses “serious risks to the continued viability of these assets,” so installing hundreds of millions of dollars’ worth of scrubber equipment is unwise.

“Faced with these realities, the only prudent option was to shut down Rush Island instead of adding scrubbers,” Birk said.

For resource planning purposes, Ameren long assumed the 1.2-GW plant would retire sometime in 2039.

The embattled coal plant has been at the center of a yearslong legal battle over its emissions. In 2007 and again in 2010, Ameren replaced boiler components at Rush Island that upped output without completing a new source review as required under the Clean Air Act, triggering a lawsuit from the Sierra Club and an eventual court order to install pollution controls or shut down.

Birk said the securitization of the cost of retirement for Rush Island is appropriate because Ameren made “prudent decisions” when making investments in the plant. He argued that at the time, the boiler upgrades were viewed as routine and completed by other utilities without a new source review.

The District Court in late September approved Ameren’s decision to retire the plant in October 2024. It previously said the plant should cease operations in March.

Whether Rush Island can retire by October is unclear. Ameren itself cautioned in its filing the new retirement date could change.

The plant has been operating for more than a year under a MISO-designated system support resource (SSR) agreement, used to keep generation operating past planned retirement dates for the sake of system reliability.

MISO last year deferred Ameren Missouri’s planned retirement of Rush Island to keep the grid reliable. The utility pulls in a FERC-approved $8.3 million monthly payment to keep the two-unit Rush Island Energy Center operating (ER22-2721). (See FERC Approves Lower MISO Reliability Payments to Ameren Coal Plant.)

In early summer, MISO said it likely will require the assistance of Rush Island for nearly two more years to avert voltage violations until members complete transmission upgrades and bring wind, solar and battery storage projects proposed in Illinois and Missouri online. The RTO previously said it plans to renew the SSR once more in 2024. (See MISO Poised to Extend Missouri Coal Plant’s Life.)

However, MISO spokesperson Brandon Morris said MISO’s tariff cannot override a federal court order; “therefore, Rush Island must cease operation on this date.”

“MISO will follow its tariff in determining if the existing SSR contract can be extended or if a new SSR contract can be issued for the period between Sept. 1, 2024, when the existing SSR contract expires, and this Oct. 15, 2024, date,” Morris said.

MISO declined to comment on whether it sees a need to request an extension of the SSR and didn’t elaborate on whether it expects enough new generation and system upgrades in place by the third quarter of 2024 to take the two coal units’ place.

The Missouri Public Service Commission has set a Dec. 15 deadline for those wishing to intervene in the case.