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Hardin power plant

Heorot Power's Hardin Generating Facility is seen in April 2017.

The owner of a coal-fired power plant in Hardin has lost money from the site since 2014 and plans to leave town.

Gary Arneson, vice president of operations for Heorot Power, said in a Nov. 15 letter to the Montana Public Service Commission that if the company can't find a buyer for the facility, it could close by the first or second quarter of 2018.

The Hardin plant, constructed in 2006, is among the newest in the state. Heorot has relied on short-term energy contracts to sell electricity from the plant.

Rocky Mountain Power is the local entity that owns the plant. It's operated by Colorado Energy, which is owned by Heorot Power.

The plant employs 30 people. In his letter, Arneson wrote that though overhead is low relative to other thermal generators, the plant still lost money.

"Unfortunately, these losses are no longer sustainable, and the Company is forced to make a decision about the plaint's future," he said.

Taylor Luther Group, a Helena law firm, is representing the owners of the plant.

Pam Bucy, an attorney at Taylor Luther, said that the company has kept up payments on its $3 million payroll, despite market conditions that temporarily halted operation.

A shutdown of the plant would affect the Absaloka Coal Mine on the neighboring Crow Reservation. Arneson said in his letter that the tribe would suffer losses from royalties derived from about 550,000 tons of coal mined annually to supply the Hardin plant.

Arneson also said a shutdown would "eliminate" $440,000 in annual property tax payments to local governments. But the plant hasn't paid those property taxes for 2014 and 2016. The company owes more than $2 million to Big Horn County in delinquent taxes and penalties.

Hardin issued about $12 million in bonds in 2006 to build infrastructure supporting the power plant. Payments on those bonds have been in default, as they relied on revenue from the plant.

The plant did pay 2015 taxes, but nothing since then, said Big Horn County Treasurer Jody Guptill.

Bucy said that the company is actively seeking buyers. She said that interest in the power plant includes those in the renewable energy sector. An environmental assessment was already completed as part of a solar array proposal from 2012.

The plant is also two miles from a natural gas pipeline.

Bucy said that the company's exit might be slowed if it can identify a buyer by the end of the year. In the meantime, representatives have met with tribal and local government officials.


General Assignment Reporter

Reporter for The Billings Gazette.