The California Public Utilities Commission at its May 21 meeting will look at approving a new power contract offered by Southern California Edison with a much revamped Watson Cogeneration plant.
Southern California Edison (SCE) is seeking approval of agreements with Watson Cogeneration Co. That includes a seven-year Power Purchase Agreement (PPA) that SCE executed with Watson Cogeneration for energy and capacity from its cogeneration facility.
Under this PPA, the Watson combined cycle gas turbine topping cycle cogeneration facility will undergo operational changes as part of an effort to reduce power plant emissions, including greenhouse gas emissions, in California. Watson Cogeneration is an existing combined heat and power (CHP) facility that operates four parallel gas turbine-driven power generator/heat recovery steam generator trains, two parallel steam turbine-driven power generators, auxiliary equipment, and a substation. Watson is owned 51% by Tesoro Refining and Marketing and 49% by NRG Energy and provides steam to the Tesoro Los Angeles Refinery. It currently delivers energy and capacity to SCE under a Transition PPA that expires July 1, 2015.
In June 2014, Watson approached SCE to initiate bilateral negotiations for a subsequent PPA. SCE requests that the CPUC find that the CHP PPA count for 385 MW toward a CHP procurement target. SCE states that Watson will “institute a change in operations” that will result in emissions reductions proposed to be 25,709 metric tonnes (MT), but details of just what will be changed aren’t included in a public version of a draft resolution for the May 21 meeting.
The draft resolution noted that SCE provided a caveat that, according to Tesoro’s representations, the Watson contract would “facilitate” the optimization and reconfiguration of the Carson and Wilmington refineries to achieve operational efficiencies, including the shutdown of a fluid catalytic cracker at Wilmington, which in itself will reduce greenhouse gas emissions.