Midwest Generation LLC, the owner of a fleet of coal-fired power plants once developed and run by Commonwealth Edison Co., today filed for bankruptcy protection from its creditors.

The filing, in U.S. Bankruptcy Court in Chicago, was made alongside Santa Ana, Calif.-based parent Edison Mission Energy, which also sought bankruptcy protection.

The long-anticipated move marks an important chapter in determining the future of MidwestGen's four power-plant stations, three of which are in the Chicago area. The facilities employ 845, including 539 relatively high-paying union jobs.

While in bankruptcy MidwestGen intends to continue operating the plants. Meanwhile, the company recently applied to the Illinois Power Control Board for a variance that would modestly delay the timetable MidwestGen already has agreed to with the state of Illinois to put modern pollution controls on the plants it plans to continue operating.

That request would delay the expenditure of about $200 million in cleanup investment planned for 2013 and 2014 until 2015.

Under a restructuring plan, which needs court approval, Edison International, the holding company for Edison Mission Energy, will transfer its 100 percent equity interest in Edison Mission to unsecured creditors including noteholders, who together hold about $3.7 billion of the company's outstanding public debt.

A large portion of the debt is held by a group of hedge funds including York Capital Management, which invests in distressed debt.

The restructuring aims to substantially reduce the company's existing public debt. The company plans to negotiate a plan of reorganization with its creditors that will determine how the operation will be recapitalized once it emerges from bankruptcy. The process is expected to take up to a year.

The plants, which generate 4,300 megawatts, have historically met about half of the Chicago area's electricity demand. Edison Mission Energy purchased them from ComEd in 1999 for nearly $5 billion.

But, as Illinois' power generation market now is deregulated, MidwestGen's plants in the aggregate have been unable to operate profitably as electricity prices have fallen due to slack demand and low natural gas prices, which correlate strongly to wholesale power prices. A heavy debt burden made bankruptcy virtually inevitable some time ago.

MidwestGen President Doug McFarlan said in an interview that little will change operationally in the near term due to the bankruptcy. Further personnel cutbacks aren't expected, as the company already has eliminated 200 jobs in the past year.

“We've made significant investments in the plants, as well as significant cutbacks in recent years,” he said. “We still have a lot of decisions to make regarding future investments.”

MidwestGen actually leases units at two of the largest power plants, in southwest suburban Joliet and downstate Pekin, under sale-leaseback agreements with outside firms. Those firms have agreed to 60-day forbearance agreements with MidwestGen that, for now, will keep the plants operating as they have.

Environmentalists long have pressured MidwestGen to accelerate the installation of modern pollution-control equipment on its aging fleet.

In a statement, Howard Learner, executive director of the Chicago-based Environmental Law and Policy Center, said: “When Midwest Generation was profiting while wholesale electricity market prices were high, it sent dividends to its parent company in California; now, while wholesale market prices are low, the California-based parent has not supported Midwest Generation and has helped to trigger the bankruptcy.

“We regret the impacts on Illinois workers and communities where Midwest Generation's coal plants are located. We will engage to make sure that if these old highly polluting coal plants continue to operate, that they are cleaned up with the installation of modern pollution control equipment.”

MidwestGen emphasized that its growing number of wind farms are not subject to the bankruptcy filing. Mr. McFarlan said all but three of those 29 facilities operate under long-term purchase contracts. Among the wind farms without a long-term agreement is one of MidwestGen's largest, the Big Sky project in the Illinois counties of Bureau and Lee, about 100 miles west of Chicago.

(Reuters contributed to this story.)