Dow Chemical Co. and Consumers Power Co., which sued each other over the mothballed $4.1-billion Midland nuclear power plant, announced an agreement Wednesday to jointly convert it to burn natural gas.
The plant, about 85% complete when construction was halted two years ago, would provide electricity and steam for Dow's huge chemical plant in Midland, both companies said.
Richard Braatz of the Edison Electric Institute, an association of investor-owned utilities, said he believes that Midland and the William H. Zimmer Station plant near Cincinnati are the nation's only nuclear power plants being converted to other fuels.
"Those were the only two units which were so far along, where there was a major switch," Braatz said, noting that about 100 nuclear plants nationwide have been canceled during construction, largely because of cost overruns.
Under the deal, Consumers probably will keep 49% of the new plant, with Dow and some unidentified investors owning the remainder, both companies said.
In addition, Consumers said, the plant would qualify as a cogeneration facility under the federal Public Utilities Regulatory Policy Act.
Cogeneration facilities are allowed to charge prices that are 10% to 15% more than current prices for electricity but less than charged for power produced by other new plants.
Consumers estimates that it will cost an additional $434 million to convert the plant to burn natural gas. The companies refused to disclose details of their agreement until a final contract is approved.
At the companies' request, the trial of their lawsuits was recessed, and they agreed to work out all remaining differences.