LG&E, KU receive key permit for combined-cycle unit in Kentucky

PPL (NYSE: PPL) subsidiaries Louisville Gas & Electric (LG&E) and Kentucky Utilities (KU) have received a key permit that moves them a step closer to developing a new 640-MW combined-cycle natural gas plant in coal-heavy Kentucky.

The companies said Sept. 4 that they had received a construction permit from the Louisville Metro Air Pollution Control District. The $583m project had already received approval from the Kentucky Public Service Commission in the spring, the companies said in a statement. The PSC issued LG&E and KU a certificate of public convenience and need for the plant.          

The companies announced plans for the new natural gas unit in September 2011. Bluegrass Power Constructors (a joint venture between PLC Industrial Construction and Black & Veatch) a contract to design and build the plant in Jefferson County, Ky.

The project will feature Siemens gas turbines.

LG&E and KU anticipate receiving a U.S. Army Corps of Engineers water permit in the near future, which will allow construction on the new plant to begin later this year. A new eight-mile natural gas transmission line – built mostly on existing rights-of-way – will also be constructed to deliver fuel to the new unit. The new unit is expected to be in-service by the end of 2015.

At the peak of the construction phase for the new unit, approximately 250 jobs are expected to be created.

The new unit is intended to replace part of the generating capacity that will be lost through the retirement of coal units at Cane Run, Green River and Tyrone Stations, caused by more stringent Environmental Protection Agency rules, the companies said. The coal-fired units – representing more than 13% of the utilities’ coal fleet – are scheduled to be retired by the end of 2015.

“We’re entering the largest construction phase in our company’s history that includes major environmental projects at most of our facilities,” said for LG&E and KU Senior Vice President of Energy Services Paul Thompson.

For all of the major construction projects taking place at LG&E and KU that are necessary for continued compliance with more stringent environmental regulations, as many as 2,000 construction jobs may be needed.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.