The Tennessee Valley Authority announced today it is buying its biggest natural gas power plant as the federal utility continues its shift from coal to gas generation.
Subject to board approval in April, TVA has agreed to purchase the 968-megawatt Magnolia Combined Cycle Gas Plant in northern Mississippi from Kelson Limited Partnership, a wholly owned subsidiary of Kelson Energy Inc. The three-unit, natural gas-fired electric generating plant is located on a 374-acre site in Benton County near Ashland, Miss., and has been a source of purchased power for TVA since the plant began operation in 2003.
Kelson has owned the facility since 2005 but decided to sell the plant, if regulators and TVA agrees.
"TVA continually evaluates our options to ensure a reliable, competitively priced supply of power for the people of the Tennessee Valley," Bob Irvin, senior vice president for TVA Strategy & Planning, said in a statement today. "The Magnolia plant offers a strong strategic, operational and financial fit for TVA and its vision to be a leader in low-cost and cleaner energy by 2020."
Terms of the deal were not disclosed for competitive reason, but TVA spokesman Duncan Mansfield said the purchase price will be less than half the cost of new construction.
Since 2007, TVA has already purchased, leased or built four other gas-fired power plants.
Check out details in tomorrow's Times Free Press.