The Michigan Department of Environmental Quality granted Consumers Energy an air permit to go ahead with the construction of an 830-megawatt coal plant in Bay County.
"The issuance of the air permit for our new clean coal plant is good news for Michigan," said John Russell, Consumers Energy's president and chief operating officer.
Consumers Energy in return must retire as many as seven of its old coal-fired plants in the state. The state utility has the oldest portfolio of coal-fired power plants in the United States, with some dating to the 1950s.
Russell said the retirements are part of the company's energy initiative that envisions a reduction in emissions by as much as 91 percent for sulfur dioxide, 83 percent for nitrogen oxides and 81 percent for mercury. Consumers Energy aims to meet its emission strategy in part through wind and solar power projects in Michigan.
Consumers Energy plans to clear another obstacle when it files a certificate of necessity with the Michigan Public Service Commission in 2010.