Analysis of Economic Feasibility of Proposed Coal Plant
Analysis Group was retained by a large EPC (engineering, procurement, and construction) firm, which was the defendant in a breach of contract dispute brought by a public utility serving power systems in various states in the Midwest and Mid-Atlantic regions. An Analysis Group team including Managing Principals Andrea Okie and Pavel Darling supported Senior Advisor Susan F. Tierney in assessing the economic attractiveness of a cancelled coal power plant relative to numerous project alternatives at various points in time using busbar analysis.
Our analysis evaluated certain events and market conditions affecting investments in electric generation options during the period in question. This assessment included various factors affecting the economics of power plant projects, including changes in fuel costs, readiness of pollution control technologies, expectations about project output, environmental policy risks, and comparisons to various other technologies whose economics would also be affected by such factors. Dr. Tierney found that several important conditions affecting energy markets changed over the relevant period during which the plaintiff was evaluating the economics of building a new coal-fired generating station, and the plaintiff's analyses did not adequately take these changes into account as the electric utility considered whether to continue to pursue the coal generating station project in question.
Following a successful motion for summary judgement, the matter settled favorably for our client.