Hallador Energy To Begin DOE Negotiations For $27.2M Indiana Power Plant Modernization

• The project will modernize the Merom Generating Station in Indiana, with total costs estimated at about $56.9 million.
• Upgrades will focus on water management systems to meet future environmental regulations and support reliable power delivery in the MISO region.
• Management said the modernization effort is expected to extend the plant’s operational life and improve its ability to provide flexible, dispatchable power for regional demand.

Hallador Energy (HNRG) announced on Friday that its subsidiary, Hallador Power Company, has been selected by the U.S. Department of Energy to begin negotiations for up to $27.2 million in potential funding to upgrade its Merom power plant in Indiana.

Shares of the company rose as much as 4% in after-hours trading following the announcement before trimming gains. Earlier in Friday’s regular session, HNRG had fallen more than 12%.

Project Cost And Scope

The company estimates the total cost of the modernization project at about $56.9 million. The upgrade is aimed at improving water management systems at the Merom Generating Station to meet upcoming federal environmental requirements.

Hallador Power plans to modernize water handling systems at Merom Units 1 and 2, focusing on treating and reusing process water more efficiently. The goal is to reduce or eliminate liquid discharge from the plant.

The Merom Generating Station is a 1,080-megawatt coal-fired facility that supplies electricity to parts of Indiana, Illinois, Kentucky, and other areas in the MISO power grid region. 

Impact On Local Economy And Power Supply

The project is expected to support regional energy reliability for both rural and urban customers while also contributing to local economic activity through the use of domestic suppliers and contractors.

Hallador also said the initiative could support local tax revenues that fund schools, infrastructure, and public services.

However, the company added that it does not expect the potential DOE funding to have a material impact on its 2026 financial results and added that there is no guarantee the funding will ultimately be awarded. 

HNRG Stock: What Retail Thinks

On Stocktwits, retail sentiment around HNRG stock is ‘bullish,’ unchanged over the past 24 hours, while message volume is ‘high.’

Hallador Energy is an independent power producer based in Indiana. It operates two main businesses, Hallador Power Company, which generates electricity at its 1-gigawatt Merom plant, and Sunrise Coal, which supplies fuel to the plant and other customers.

The HNRG stock has fallen 5.5% in the past 12 months. 

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