KNOXVILLE - The Tennessee Valley Authority will shut down the Allen coal plant in Memphis and build a new natural gas-fired power plant on the same site in the next four years.
TVA directors Thursday unanimously approved construction of a $975 million, combined-cycle gas plant to replace the power generated by the three-unit Allen Fossil Plant. The new high-efficiency gas plant will be the seventh natural gas plant TVA has added to its power portfolio since 2007 and will be the third combined cycle plant TVA has or will build to replace a coal plant being shut down to comply with new air pollution regulations.
With a projected capacity of about 1,000 megawatts, the new gas plant will generate more power than the 741-megawatt coal plant it will replace. The new plant will generate enough power to supply about 580,000 homes.
TVA President Bill Johnson said the gas plant was not as big as the 1,400-megawatt gas plant considered by TVA during its environmental assessment of the future of the Allen steam plant.
TVA also may eventually opt to use the gas plant to supplement new wind and solar generation, which tends to be more variable. Gas-fired generation is better suited for variable power production than TVA's massive nuclear or coal-fired plants, which are more efficient if run around the clock.
TVA was under a consent agreement to either clean up or shutter the 55-year-old Allen plant by the end of 2018. The Allen plant, originally built by the Memphis Light, Gas and Water municipal utility in 1959, was acquired by TVA in 1984. But it lacked scrubbers and other pollution control devices to meet today's air quality standards.
Johnson said TVA considered other sources of energy to replace Allen, including wind, solar and clean coal. But he said such replacement power was anywhere from 80 to 360 percent more expensive than the combined-cycle gas plant.
Lynn Evans, the TVA director from Memphis and a former MLGW director, supported the shut down of Allen even though it will cost about 100 jobs. Allen is one of the biggest sources of air pollution in Memphis and the new natural gas plant will cut carbon emissions by 60 percent and nitrogen oxides by more than 90 percent.
"After considering the many factors from the environment, the employees and the economy, I support this recommendation of a gas plant size that is less than the maximum size that was once considered," Evans said.
TVA is considering buying power from a new 3,500-megawatt transmission line that is proposed to built from Oklahoma to Memphis to carry wind-generated power. Johnson said TVA is still evaluating that proposal from Clean Line Energy Partners and other similar plans for more renewable energy sources. But in the meantime, TVA needs a reliable energy source to help the utility continue its 14-year record of delivering power to its customers 99.999 percent of the time.
"Memphis is our largest customer and we must have a proven source of generation in the city to ensure system-wide reliability while giving us flexibility that allows for future growth," Johnson said.
Contact Dave Flessner at email@example.com or at 757-6340