NRG Energy (NYSE: NRG) said Aug. 8 that it plans to start construction in September on a new 75-MW natural gas combustion peaking turbine at its sprawling W. A. Parish power plant southwest of Houston.
The facility will serve a dual role – serving the energy-hungry Texas grid for a couple of years and subsequently help NRG develop a carbon capture and storage (CCS) project the Parish station.
The new unit will be able to bring 75 MW of power to the grid within minutes, helping meet high demand periods and backing up intermittent renewable generation in Texas. The new unit is expected to be online in time for the summer air conditioning season of 2013.
The combustion turbine will provide electrical generation to Texas for at least two years. In 2015, it is anticipated that the unit will begin supporting operation of a post-combustion carbon capture system designed to capture approximately 90% of the carbon dioxide from a portion of the flue gas of an existing coal unit at the Parish plant. Parish is located on more than 4,000 acres in Fort Bend County, Texas, and includes both coal and natural gas generating units.
The captured carbon dioxide will be used in enhanced oil recovery (EOR) to revitalize an oilfield located in southeast Texas to increase domestic oil production. The carbon capture system is part of the Clean Coal Power Initiative with the Department of Energy.
NRG was selected to receive DOE funding for the CCS project in 2010.
“The new unit will bring additional power to the grid very quickly, cleanly and efficiently,” said NRG Gulf Coast President John Ragan. “While we expect that it will ultimately be used for a carbon capture system, by leveraging the planned construction of the carbon capture system and building the combustion turbine now, ahead of the economic price signals that would allow us to build new generation on its own, we can help the State of Texas meet its needs over the next two summers.”
To support future expected growth in the state, NRG Energy has also permitted a large combined cycle unit at its SR Bertron plant east of Houston and anticipates submitting a permit for another large combined cycle unit in the coming months.
“NRG is very interested in building new generation in Texas and wants to be ready to start construction on a new unit as soon as the economic conditions allow,” added Ragan. “While we cannot build these large units today, the continued increase in demand in the State over the last few years coupled with the efforts of the Public Utility Commission of Texas has helped to move us closer to being able to break ground on additional units in the future.”
NRG did not announce an estimated cost for the 75-MW peaker. However, in May, NRG executed a $54m tax‐exempt bond financing in connection with the construction of a peaking unit at Parish.
NRG isn’t the only company to announce backup generation in the Southwest in recent days. Xcel Energy (NYSE: XEL) said Aug. 6 that it is developing 23 MW of standby power in Quay County, N.M.
In addition to using clean-burning natural gas, the new unit will use the Texas Commission on Environmental Quality’s latest prescribed Best Available Control Technology including ultralow nitrogen oxides (NOx) burners. NRG anticipates as many as 100 construction workers will be employed to build the new unit.
In July, NRG announced that it was entering into a merger with GenOn (NYSE: GEN) to create the largest competitive generation in the United States. The combined company will have 47,000 MW of capacity. The companies expect the merger to close by the first quarter of 2013.