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MORRO BAY ASSURED POWER PLANT TO RUN A FEW MORE YEARS

Morro Bay got  some good news this week.The Morro Bay power plant owned by Dynegy Inc will likely not close at the end of this year as had been feared (as well as budgeted) by the city. Instead, the aging plant will continue to operate at least another 2 years mayor William Yates says.

Council including Yates was informed of these new insights at the July 10 city council meeting that talks with Dynegy had yielded this news since the June 26 city council session. If that proves out, it means an extra $500,000 to the city’s General Fund and $250,00 to the Harbor Fund from current agreements with the company. Those agreements include the Outfall Lease and Community Development Fund payments made by the plant operator to the city each year.

Fears the plant could close sooner than later have been fanned in recent weeks as Dynegy lost a power contract with SCE and on top of that, the huge firm declared bankruptcy Friday – adding to a sense of doom.

But Yates insists that “the bankruptcy issue is irrelevant” and the main issue is whether the power plant runs.The plant does have an agreement with the state ISO who operates the power grid to sell them the power when it needs it.

“They needed it today.The plant was running” says Yates.”We know the plant is last in line to run – so when it does run we know the state is really cooking” quips Yates.

Indeed, today was said to be one of the hottest days across the state this summer.Yates says since they lost the contract the plant has run”only a couple of times”

“We don’t know the future but at least for budgeting purposes this is encouraging. A few weeks ago we were expecting them to close by the end of the year.”

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