The Grand River Dam Authority Board of Directors, during its Aug. 14 meeting, gave its approval to an electric generation resource plan designed to meet both the growing demand of its large Oklahoma customer base as well as new regulations from the U.S. Environmental Protection Agency.
“We do have some very real deadlines ahead of us in regards to EPA regulations and customer demands,” said CEO/Director of Investments Dan Sullivan. “I want to commend our board for giving so much time and effort to this issue already and for the decision today that allows GRDA to move towards these important goals.”
The plan would allow for an increase in both GRDA’s gas and wind generation capacity. Together, that capacity would eventually replace the output from Unit 1 at the 1,010-MW GRDA Coal Fired Complex, often called the Chouteau plant. That unit has been in operation since 1982 and has paired with Unit 2 at the facility to provide the bulk of GRDA’s electric generation for three decades.
“Today, approximately 45 percent of GRDA’s total generation capacity comes from our coal units,” said Sullivan. “However, as this plan is put into place and we are able to add wind and gas generation, coal will go to about 17 percent.”
The remaining coal generation will come from Unit 2 following a project to retrofit/upgrade that unit’s air quality control equipment. In operation since 1985, the unit is already equipped with the state’s only flue-gas desulfurization (scrubber) system. The scrubber will remain in service through the upgrade effort and GRDA will convert other existing air quality control equipment to meet the latest EPA standards. The deadline for those standards is April 2016 though GRDA is planning to have these upgrades completed by December 2015.
U.S. Energy Information Administration data shows that the coal suppliers to the GRDA plant earlier this year were the Caballo, Rawhide and Antelope mines in the Wyoming Powder River Basin, with that coal sold through Peabody Coal Sales, a unit of Peabody Energy (NYSE: BTU). GenerationHub data shows Unit 1 at the plant with 490 MW of net summer capacity, and Unit 2 with 520 MW.
As its reliance on coal goes down, GRDA said it will be able to bring greater balance to a generation portfolio that already provides a beneficial and diverse mix of resources. Though hydroelectric output will not change significantly with the new plan, gas generation will go from 25% of total capacity to 45%. GRDA also plans to increase its wind generation from approximately 3% of total capacity today to 13% in the future.
“This resource mix really gives GRDA the options it needs to maintain reliability and efficiently, and that’s in the best interest of our ratepayers,” said Sullivan.
During the meeting, the board voted to proceed with a plan to develop a 400-MW combined cycle gas facility, to be constructed on an existing site — adjacent to the GRDA Coal Fired Complex in Chouteau — as part of GRDA’s future generation plan.
Headquartered in Vinita, GRDA is Oklahoma’s state-owned electric utility.