GenOn announced Tuesday that it will close its coal-fired power plant in Alexandria near the end of next year (Gerald Martineau/The Washington Post)

It’s a pivotal, historic moment for Alexandria, which was looking at about 91 more years of the plant cranking out low levels of energy from a prime spot on the Potomac. Earlier this month, the American Clean Skies Foundation came up with a green proposal for a mixed-use development on the site, if GenOn went away.

Now,GenOn apparently is going to retire the station by October 2012, according to a release from the city. As an inducement, Alexandria is going to release about $32 million it was holding in escrow to pay for environmental controls at the plant.

A report earlier this month said the plant was not necessary to keep the lights on in the Washington region. It has failed to meet environmental regulations after several new monitoring systems were installed, a result of local activists’ work.

D.C. Mayor Vincent C. Gray’s administration this summer also announced they were considering petitioning the Environmental Protection Agency to close the plant because of the emissions.

“Retiring the facility next year makes sense for GenOn,” company chief executive Edward R. Muller said in a statement. “But it is a dificult decision, given the impact on the approximately 120 employees who work at the station.”

Alexandria Mayor William Euille said, “Today’s announcement is a path forward for both Alexandria and the power company that works for everybody, and truly reflects the interest of both parties.”

Now comes the real battle for the future of that space. But that’s for another time. Today, this breaking news is huge for Alexandria.

Also contributing to t his article was Washington Post reporter Patricia Sullivan.