CPS Energy agrees to new 200-MW contract with Summit Power IGCC

CPS Energy, the municipal utility for San Antonio, Texas, said Oct. 6 that it has agreed to a new contract to buy 200 MW of electricity from an integrated gasification combined-cycle (IGCC) plant being developed by Summit Power Group.

Summit’s Texas Clean Energy Project IGCC would gasify coal and use carbon capture and storage (CCS). The CCS would allow Summit to capture 90% of the CO2 and use it for enhanced oil recovery in the West Texas Permian Basin.

A previous purchase power agreement between Summit Power Group and CPS Energy expired at the end of 2013; the parties have been in negotiations since then.

The new agreement is more favorable to CPS Energy customers, as power prices in the Electric Reliability Council of Texas (ERCOT) market have dropped while the project has been in development, CPS said in the news release.

The plant, to be built roughly 15 miles west of Odessa, TX, is expected to be online in 2019.

“We remained hopeful this project would be built and that CPS Energy customers could take advantage of this low-carbon source of power,” said CPS Energy CEO Doyle Beneby. “Adding clean coal to our portfolio dovetails with our strategies to diversify and reduce the carbon intensity of the power we supply to our customers.”

Adding clean coal also could help CPS Energy and the state of Texas meet stringent new federal carbon emissions guidelines, he added.

Summit Power recently announced that it has hired a new CEO.

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.