TVA putting more coal units onto road to retirement

The Tennessee Valley Authority is making progress on retiring a number of coal-fired units under agreements it worked out a few years ago with the federal government, plus several states and environmental groups.

As of Sept. 30, TVA had 10 coal-fired plants consisting of 41 active units, accounting for 11,933 MW of summer net capability, said the federal utility in its annual Form 10-K report filed on Nov. 17 at the SEC. As of Sept. 30, TVA had 18 inactive coal units. Inactive units may be in three categories: retired, mothballed, or inactive reserve. Retired units are unavailable for service and are not expected to return to service in the future.

As of Sept. 30, TVA had 11 retired units:

  • John Sevier Fossil Plant  Units 1-4;
  • Shawnee Fossil Plant Unit 10; and
  • Widows Creek Fossil Plant Units 1-6.

Mothballed units are unavailable for service but can be brought back into service after some maintenance with an appropriate amount of notification, typically weeks or months.  As of Sept. 30, TVA had seven mothballed coal units:

  • Johnsonville Fossil Plant Units 5-10; and
  • Colbert Fossil Plant Unit 5.

Inactive reserve units are unavailable for service but can be brought back into service after some repairs in a relatively short duration of time, typically measured in days. As of Sept. 30, TVA had no units in inactive reserve. TVA refers to units which are in inactive reserve or mothballed status as idled. In addition, as of Oct. 1, TVA mothballed Widows Creek Unit 8.

During 2014, the TVA Board took several actions related to the retirement of certain coal-fired units. Upon the completion of a new natural gas-fired facility of about 1,000 MW at the Paradise Fossil Plant site in western Kentucky, coal-fired Units 1 and 2 at Paradise with a summer net capability of 1,230 MW will be retired. And upon the completion of a natural gas-fired facility at the Allen Fossil Plant site of about 1,000 MW in size, coal-fired Units 1-3 at Allen with a summer net capability of 741 MW will be retired.

The TVA Board also approved the retirement of Colbert Units 1-4 and 5 with a total summer net capability of 1,184 MW no later than June 30, 2016, and Dec. 31, 2015, respectively, as well as the retirement of Widows Creek Unit 8 with a summer net capability of 465 MW in the unspecified future.

Under terms of the Environmental Agreements, TVA must decide whether to install additional air pollution controls on Units 1 and 4 at Shawnee, convert those units to burn biomass, or retire them by Dec. 31, 2017.  The decision on Units 1 and 4 must be communicated to the EPA and the other participants by Dec. 31, 2014. TVA is preparing an Environmental Assessment to help decide the future of Units 1 and 4, which have a summer net capability of 268 MW. The options to install scrubbers and selective catalytic reduction controls or permanently retire the units will be examined in more detail in the Environmental Assessment. There are seven additional operating coal-fired units at Shawnee that are not covered by the Environmental Agreements.

Target is 8,089 MW of remaining coal capacity after shutdowns are made

In April 2011, TVA entered into two agreements (collectively called the “Environmental Agreements”). The first agreement is a Federal Facilities Compliance Agreement with the U.S. Environmental Protection Agency. The second is with the states of Alabama, Kentucky, North Carolina, Tennessee, and three environmental advocacy groups: the Sierra Club, National Parks Conservation Association, and Our Children’s Earth Foundation.  Under the Environmental Agreements, TVA agreed to retire 18 of its 59 coal-fired units by the end of 2017. TVA said it is confident that it has adequate capacity to meet the needs of its customers after these units are retired.

As of Sept. 30, 2010, TVA had 14,573 MW (summer net capability) of coal-fired generation. After actions taken to comply with the Environmental Agreements and actions by the TVA Board during 2014, TVA will have 8,089 MW (summer net capability) of coal-fired generation.

Transmission upgrades may be required to maintain reliability when some coal-fired units become inactive. TVA said it invested $215m in such upgrades between 2011 and 2014, and estimates future expenditures for transmission upgrades to accommodate inactive coal-fired units to be approximately $230m for 2015 to 2020. Upgrades may include enhancements to existing lines and substations or new installations as necessary to provide adequate power transmission capacity, maintain voltage support, and ensure generating plant and transmission system stability.

To reduce SO2 emissions, TVA installed scrubbers on 17 coal-fired units with scrubbers under construction on four more units at Gallatin, and switched to lower-sulfur coal at 24 coal-fired units. To reduce NOX emissions, TVA installed selective catalytic reduction (SCR) on 20 coal-fired units with SCRs under construction on four more units at Gallatin (the same ones getting the scrubbers), operates selective non-catalytic reduction systems (SNCR) on four units, installed low-NOX burners or low-NOX combustion systems on 25 units, optimized combustion on five units, and operates NOX control equipment year round when units are operating (except during start-up, shutdown, and maintenance periods). TVA has also retired or announced plans to retire 32 of 59 coal-fired units and expects all coal-fired units will either have scrubbers and SCRs, be repowered to renewable biomass, or be retired.

Coal burn down a bit in October 2013-September 2014 fiscal year

Coal consumption at TVA’s coal-fired facilities during fiscal 2014 and 2013 was approximately 31 million tons and 32 million tons, respectively. At both Sept. 30, 2014, and Sept. 30, 2013, TVA had 29 days of system-wide coal supply at full burn rate with net book values of $361m and $374m, respectively.

During fiscal 2014, long-term contracts made up 91% of coal purchases and short-term contracts accounted for the remaining 9%. During fiscal 2014, TVA purchased coal by basin as follows:

  • 47% from the Illinois Basin;
  • 36% from the Powder River Basin in Wyoming;
  • 14% from the Uinta Basin of Utah and Colorado; and
  • 3% from the Appalachian Basin in Kentucky, Pennsylvania, Tennessee, Virginia and West Virginia.

Total system coal inventories were generally at or above target levels for most of fiscal 2014 due to lower than planned coal-fired generation requirements. However, due to persistent performance issues with certain rail companies, inventories at some facilities fell below minimum levels during 2014. Additionally, some coal-fired units were placed in reserve in the spring to conserve coal for summer peak use.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.