Babcock & Wilcox wins contract for Pawnee SCR installation

The Babcock & Wilcox Co. (B&W) (NYSE: BWC) said April 9 that subsidiary Babcock & Wilcox Power Generation Group (B&W PGG) has been awarded a contract valued at more than $30 million for a selective catalytic reduction (SCR) system for Xcel Energy’s (NYSE: XEL) coal-fired Pawnee plant.

The SCR system, to be used to control NOX emissions from the Colorado plant’s boiler, is the second major environmental project that B&W has signed recently with Xcel Energy. In February, B&W announced a contract to design and supply two spray dry absorber (SDA) units for SO2 control at the 500-MW Pawnee plant. Start-up of the new equipment is scheduled for mid-2014.

“We’re appreciative that Xcel Energy has selected B&W to help it comply with the Colorado Clean Air-Clean Jobs Act,” said B&W PGG President and COO J. Randall Data. “B&W‘s many decades of experience with environmental controls is unmatched in the industry and allows us to provide solutions for all of our customers’ emissions reduction needs.”

Xcel Energy’s Public Service Co. of Colorado subsidiary has been making a number of moves to comply with the Colorado Clean Air-Clean Jobs Act (CACJA). The CACJA required PSCo to file a comprehensive plan to reduce annual emissions of NOx by at least 70% to 80% or greater from 2008 levels by 2017 from the coal-fired generation identified in the plan. The plan allows PSCo to propose emission controls, plant refueling, or plant retirement of at least 900 MW of coal-fired units in Colorado by 2017. The total investment associated with the adopted plan is approximately $1bn through 2017 and the rate impact is expected to increase future bills on average by 2% annually, Xcel noted in its Feb. 24 annual Form 10-K report.

In December 2010, the Colorado Public Utilities Commission approved the following act compliance actions:

  • the shutdown of Cherokee Units 2 and 1 in 2011 and 2012, respectively, and Cherokee Unit 3 (365 MW in total) by the end of 2015, after a new natural gas combined-cycle unit is built at Cherokee (569 MW);
  • fuel-switching of Cherokee Unit 4 (352 MW) to natural gas by 2017;
  • the shutdown of Arapahoe Unit 3 (45 MW) and the fuel-switch Unit 4 (111 MW) in 2014 to natural gas;
  • the shutdown of Valmont Unit 5 (186 MW) in 2017;
  • installation of SCR and a scrubber on Pawnee in 2014; and
  • installation of SCRs on Hayden Unit 1 in 2015 and Hayden Unit 2 in 2016; and
  • the conversion of Cherokee Unit 2 and Arapahoe Unit 3 to synchronous condensers to support the transmission system.

PSCo has received commission approvals for the conversion of Cherokee Unit 2 to a synchronous condenser, for the decommissioning of Cherokee Unit 1 and Unit 2, and for the Pawnee emissions controls. In addition, PSCo has filed for approval for the new natural gas combined-cycle at Cherokee station and the Hayden emissions controls.

In March 21 arguments filed in the commission case covering planned SCR installations on Hayden Units 1 and 2, the utility said its current estimate for the cost of this project is $165m, with $90m of that coming from PSCo at this co-owned facility. PSCo admitted that coal costs under a new contract with coal supplier Peabody Energy (NYSE: BTU) were higher than expected, but argued that this project is still the lowest-cost alternative.

PSCo is the operator of Hayden and owns 75.5% of Unit 1 (139 MW) and 37.4% of Unit 2 (98 MW).

Headquartered in Charlotte, N.C., B&W is a provider of clean energy technology and services, primarily for the nuclear, fossil and renewable power markets, as well as a premier advanced technology and mission critical defense contractor.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.