Hallador Energy Company (NASDAQ: HNRG) announced that its subsidiary Hallador Power Company was selected by the U.S. Department of Energy for award negotiations regarding up to $27.2 million in federal funding to modernize the Merom Generating Station in Indiana.

The total project cost is estimated at approximately $56.9 million. The modernization project aims to upgrade the plant's water management systems to meet future federal Effluent Limitation Guidelines requirements.

The project will modernize water handling systems for Merom Units 1 and 2, with the goal of achieving zero liquid discharge through advanced water treatment technologies. The 1,080 MW rated coal-fired power plant provides electricity to utilities serving southern Indiana, eastern Illinois, northern Kentucky and other areas within the MISO grid.

"Modernizing the Merom Generating Station will enhance the capabilities of our 1,080 MW rated facility for decades to come, helping power consumers, businesses, and infrastructural enhancements to the region," said Brent Bilsland, Chairman and Chief Executive Officer.

The company stated it does not anticipate the DOE funding will provide a material benefit to its 2026 financial results and cannot guarantee that funding will be awarded or received through negotiations.

Hallador Energy Company operates as a vertically integrated Independent Power Producer based in Terre Haute, Indiana, with two core businesses: Hallador Power Company, which produces electricity at the Merom Generating Station, and Sunrise Coal, which supplies fuel to the facility and other companies.

The information is based on a company press release statement.