Invenergy still battling with Duke over Lee gas plant project

Duke Energy Carolinas and the North Carolina Electric Membership Corp. on Jan. 6 objected to a revised petition by Invenergy Thermal Development LLC to intervene in a case where they are seeking approval of the 750-MW Lee gas-fired power project.

On Dec. 3, 2013, Invenergy filed at the South Carolina Public Service Commission for intervention in this case, and then filed a Jan. 2 petition that added new information to the original one. Invenergy said its bid to sell power out of its own gas-fired project that it would develop in South Carolina’s Anderson County was improperly rejected by Duke in favor of the Lee project.

In their Jan. 6 objection, Duke (which would own 650 MW of the Lee project) and North Carolina Electric Membership (the other 100 MW) said that Invenergy, a “disgruntled bidder,” is seeking undue advantage over competitors in trying to invervene in this case and get data on the power bids that Duke evaluated in coming to a decision on the Lee project. They said the Lee option was properly selected as the winner after evaluation by them and a third-party administrator.

Duke and North Carolina Electric Membership also noted that even if the commission rejects the Lee proposal, there is no guarantee that Invenergy will be the new winning bidder.

In the Jan. 2 version of its request, Invenergy said: “Invenergy is concerned about the suspect decision of Duke to self-build generation which resulted from a flawed evaluation process currently employed by Duke in South Carolina. However because the evaluation process does not allow for review of the bid process, Invenergy has been injured by the expense of its bid and Duke’s opaque RFP bid process only makes Invenergy a sham participant in Duke’s self-serving RFP process.”

Also, on Jan. 3, Duke and North Carolina Electric Membership filed a copy of a settlement on the Lee case with the South Carolina Office of Regulatory Staff. Among other things, that deal says that construction of the Lee gas plant will not affect the Duke Energy Carolinas plans regarding the acquisition of an interest in the V.C. Summer Nuclear Project currently being constructed by South Carolina utilities Santee Cooper and South Carolina Electric & Gas. Duke Energy Carolinas is engaged in good faith negotiations with Santee Cooper regarding an interest in the Summer project.

 The first of two new units under construction at V.C. Summer in South Carolina are expected to come online in either late 2017 or the first quarter of 2018. Units 2 and 3, both roughly 1,100-MW, are being built alongside the existing 965-MW unit.

Invenergy offered a new 715-MW plant in a Duke RFP

Invenergy has offered to build a 715-MW combined-cycle plant for Duke Energy Carolinas. Invenergy’s Vice President of Thermal Development, Daniel Ewan, provided a few details of the company’s project in Dec. 10, 2013 testimony at the South Carolina commission. The commission is reviewing an October 2013 application from Duke Energy Carolinas and North Carolina Electric Membership for a certificate of public convenience and necessity on the 750-MW Lee gas-fired project to be located near Anderson, S.C.

Ewan said that in November 2012, during a Duke request for proposals (RFP) process, Invenergy offered a 20-year tolling agreement for a 715-MW, 2×1 combined-cycle plant that Invenergy would build in Anderson County. That bid made the Duke short list, but Invenergy was eventually told in October of this year that Duke would pursue another option for the needed capacity. Duke then filed with the commission for approval of its own 750-MW project at its existing Lee power plant site.

Duke on Dec. 9, 2013, argued that Invenergy should not be allowed to intervene in this case at all, in part because it has sustained no injury and thus has no standing in this matter. Duke said that Invenergy has no right to see the bid results and that South Carolina statute doesn’t protect Invenergy from the harm of not getting picked as the RFP winner.

PSC staff filed a Dec. 12 letter with the commission supporting Invenergy’s intervention request, saying the independent power producer may have information that could be useful.

In November 2012, Duke Energy Carolinas received multiple proposals from twelve companies including a self-build bid for the construction of a natural gas combined cycle facility at the existing Lee site in Anderson County, S.C., said the application. The bids were reviewed for compliance with RFP guidelines and were ranked economically to determine the least cost options. The initial economic analysis identified the short-listed bidders to continue proposal discussions. In late February, Duke notified the short-listed bidders to provide refreshed proposals to meet capacity needs beginning June 2017. The Lee self-build option was picked after refreshed bids were taken.

The Lee combined cycle facility would use two combustion turbine generators (CTGs), two heat-recovery steam generators (HRSGs), and one steam turbine generator in a “2×1” configuration. Duke Energy Carolinas evaluated F Class and Siemens H Class combustion turbine technologies in various configurations. The 2×1 technology selection was chosen based on the need as well as the company’s and industry experience. The need fits well with current F Class technologies that are designed with moderate duct burning capabilities.