The latest integrated resource plan (IRP) of Duke Energy Indiana features three basic scenarios based on certain factors, with one possibility being the end of coal use at the currently coal-fired Wabash River Unit 6.
The IRP, dated Nov. 1, was recently filed under seal at the Indiana Utility Regulatory Commission (IURC). A public version has also been released as part of a public review processs.
Due to investments that would be necessary to comply with the Mercury and Air Toxics Standards (MATS), Wabash River Unit 6 cannot cost-effectively continue to operate as a coal-fired unit beyond the MATS compliance date. Preliminary analyses indicate it may be cost-effective to convert the unit to natural gas.
“The Company is benchmarking the cost effectiveness of gas conversion against the results of a request for proposals (RFP) solicitation that was issued in mid-2013,” said the IRP. “The results of that analysis will be used to make a final decision about the gas conversion and will be reflected in the 2015 IRP.”
The IRP scenarios are:
- Based on the assumptions for the Low Regulation Scenario, the Traditional Portfolio was developed. This portfolio features the retirement of a number of older coal- and oil-fired units. The conversion of Wabash River 6 to natural gas and the construction of several natural gas-fired combustion turbines (CTs) and combined cycle (CC) capacity replace the retired capacity and serve new load growth.
- Based on the assumptions for the Reference Scenario, the Blended Approach Portfolio was developed. This portfolio features the retirement of the same units that were retired in the Traditional Portfolio. Wabash River 6 is converted to natural gas in the Blended Approach portfolio, and CTs, CCs, and partial ownership of a nuclear unit are added.
- Based on the assumptions for the Environmental Focus Scenario, the Coal Retires Portfolio was developed. This portfolio assumes the retirement of all of the existing pulverized coal units. The Coal Retires portfolio includes CTs, CC’s, a full nuclear unit, and a higher level of renewables and energy efficiency (EE) to replace the retired capacity and serve new load growth.
Duke Energy Indiana’s current capacity consists of 4,765 MW of coal-fired steam capacity, 595 MW of syngas/natural gas combined cycle capacity, 285 MW of natural gas-fired combined cycle capacity, 45 MW of hydroelectric capacity, and 1,804 MW of natural gas-fired or oil-fired peaking capacity. Also included is a power purchase agreement with Benton County Wind Farm (100 MW, with 9 MW contribution to peak modeled).
The largest coal units are the five Gibson units at approximately 620 MW-630 MW (net) each, and the two Cayuga units at about 500 MW each. The smallest coal-fired units on the system are the 85-MW each Wabash River Units 2-4. Wabash River Unit 5 is 95 MW, while Unit 6 is 318 MW.
Retirement of three Wabash River units in the definite category
Analyses performed in the 2011 IRP and in Duke Energy Indiana’s MATS rule Phase 2 Compliance Plan, approved by the Indiana commission in April of this year, showed that retirement of Wabash River units 2-5 was more economical than retrofitting these units to comply with MATS. The assumed retirement date in this 2013 IRP is the MATS compliance date of April 16, 2015.
Longer term, the coal-fired Gallagher Units 2 and 4 could potentially retire in 2019. However, no decisions have been made at this time and Duke said it will continue to study this issue in future IRPs. The Wabash River Unit 6 gas conversion is expected to operate for 15 years, then retire in 2031.
The Duke Energy Indiana MATS rule Phase 2 Compliance Plan approved earlier this year resulted in the recommendation of, and approval by the IURC of, the following emission control equipment and strategic components:
- the installation of selective catalytic reduction (SCR) with SO3 mitigation on Cayuga Units 1 and 2;
- the installation of mercury re-emission chemical additive systems to the existing scrubbers on Cayuga Units 1 and 2, Gibson Units 1-3, and Gibson Unit 5;
- the installation of mercury trim controls, specifically activated carbon injection, on Cayuga Units 1 and 2, and Gibson Unit 5; and
- the retirement of Wabash River Units 2-5 by the MATS compliance date.
These new emission controls were identified as part of an overall optimal plan to comply with the Utility MATS rule. Duke Energy Indiana has continued to evaluate mercury reduction technology options, resulting in some adjustments that will be proposed to the Phase 2 Plan. The construction of the Cayuga SCRs is in progress. Construction of the other smaller components of the Phase 2 Plan will commence by early 2014.
Incidentally, the utility, a unit of Duke Energy (NYSE: DUK), applied on Nov. 7 at the IURC for approval of this Phase 3 plan:
- Refurbishment of the electrostatic precipitators at Gibson Units 3, 4, and 5 in order to ensure future compliance with the MATS filterable particulate limits;
- Installation of calcium bromide systems at Gibson Units 1-5 and Cayuga Units 1-2 for mercury trim control;
- Installation of particulate matter continuous emission monitoring systems at Gibson Units 1-5 and Cayuga Units 1-2 to demonstrate compliance with MATS limits;
- Installation of mercury sorbent traps at the Edwardsport plant and ongoing maintenance of other company-owned and operated sorbent traps in order to demonstrate compliance with MATS limits;
- Improvements to the stacks at Gibson Units 4 and 5 to ensure safe and reliable access for certain stack testing and monitoring in order to demonstrate compliance with MATS;
- Installation of relief duct dampers on Gibson Unit 5 flue gas desulfurization equipment to help ensure compliance with acid gas limits under MATS;
- Operating and maintenance expenses associated with quarterly stack testing and Organics Work Practice Standards testing required by MATS.
While the large, relatively new Gibson coal plant is fairly safe in the company’s long-term plan, there is an issue with needed emissions control refurbishments at Unit 5 that aren’t an issue at Units 1-4. For the Gibson Station Unit 5 assessment, multiple investment alternatives and timing options were considered. The primary investments being analyzed on this unit are in the refurbishment of the existing electrostatic precipitator as well as the existing FGD. Alternative retirement decision dates were analyzed for all scenarios. Forecasted compliance dates associated with MATS, coal combustion residuals, and Ozone NAAQS drove the timing of these alternative retirement dates. Under all scenarios, retirement before 2020 is uneconomic. However, investing in Gibson 5 through 2023 (retirement before the summer of 2024) appears to be the most economic option in the Environmental Focus scenario, the IRP noted.