North Carolina approves gas units to replace coal at Duke’s Asheville plant

The North Carolina Utilities Commission (NCUC) has approved a plan by a Duke Energy (NYSE:DUK) subsidiary to build two 280-MW combined cycle natural gas-fueled generating units to replace the existing 376-MW Asheville coal plant, which will be retired by 2020.

Utility Duke Energy Progress said in a Feb. 29 news release that it had received Certificate of Public Convenience and Necessity (CPCN) for the Western Carolinas project.

Construction of the natural gas-fired combined-cycle power plants is scheduled to begin in 2016 and be in service by late 2019. Cost of the project has previously been estimated at $1.1bn.

At the same time, consumer groups noted that the commission followed the recommendation of its Public Staff and denied Duke’s request for early approval of a third, 186-MW combustion turbine peaking unit that Duke said it might need in 2023.

Under a special law passed in 2015, the Commission had only 45 days to make a decision on Duke’s proposal. The commission will issue a more detailed decision at a later date.

In November 2015, Duke abandoned plans for the 230-kV Foothills Transmission Line and Campobello substation in connection with the Western Carolinas modernization project.

The company is working with the Asheville, Buncombe County and surrounding communities to explore solutions that will reduce energy use in the fast-growing, nine-county Duke Energy Progress-West region, which serves more than 350,000 people.               

The company will closely track collective progress toward reducing daily and peak power demand and will file annual updates on the progress of the community’s efforts to reduce peak load growth.

If these efforts are successful, Duke Energy Progress will delay or cancel plans to file a future certificate application for the commercial operation of the Asheville 186-MW simple-cycle gas plant.

Duke Energy will file a future CPCN application to seek approval for a minimum of 15 MW of new solar generation over the next seven years after the Asheville coal units have been decommissioned and coal ash excavation is completed.                  

The company also plans to seek approval to install a minimum of 5 MW of utility-scale electricity storage over the next seven years. Company officials will continue to evaluate other investments in renewables and other energy technology.

Duke says project will slash emissions; water discharges

The new plant will have significantly lower environmental impacts than the existing coal plant.

•Sulfur dioxide will be reduced by an estimated 99%.

•Nitrogen oxide will be reduced by an estimated 45%.

•Mercury emissions will be reduced to negligible levels.

•Water discharges will be reduced by an estimated 50%.

•Carbon dioxide emissions will be reduced by about 60 percent, on a per-megawatt-hour basis, due to the efficiency of the new gas units and the fact that natural gas burns more cleanly than coal.

(The percentages above are estimates and include both phases of the modernization project. Final percentages will be determined after the company receives environmental permits.)

In addition to the environmental benefits, the combined cycle gas units’ efficiency ratings are about 35% less expensive to operate than the existing coal units. These savings will be annually passed on to customers dollar-for-dollar via the company’s annual fuel clause adjustment, Duke said.

“We are fully committed to creating a smarter and cleaner energy future for the region,” said Duke Energy’s North Carolina President David Fountain.

 “We also have a unique opportunity to work with the community to reduce energy demand and invest in technology that will provide cleaner energy to power the growing region of Western North Carolina,” Fountain added. “This project will allow us to continue to provide cost-effective, reliable power for all of our customers in North Carolina and South Carolina.”

Environmental groups reacted to the NCUC decisions.

“We’re disappointed in the North Carolina Utilities Commission’s decision to approve Duke Energy’s plans for a huge new gas-fired power plant near Asheville,” said Gudrun Thompson, the senior attorney at the Southern Environmental Law Center who represented MountainTrue and Sierra Club in the proceedings.

“We welcome Duke’s long-overdue commitments to retire the Asheville coal plant in 2020 and clean up the leaking coal ash basins at the site,” Thompson said. “And we agree with the commission’s decision to deny Duke’s premature application for the third unit. But replacing the coal plant with an oversized, billion-dollar gas plant will lock the region into dependence on dirty fossil-fueled power for decades when the rest of the nation is transitioning to cleaner, cheaper energy resources.”

Upgrades to existing transmission equipment on the Asheville plant site are also planned as part of this project, Duke said.

Since 1970, peak power demand has more than tripled in Duke Energy Progress’ Western Region. Ensuring power reliability was particularly difficult during the winters of 2014 and 2015, when peak demand was 30% higher than in 2013. Over the next decade, continued population and business growth is expected to increase overall power demand by more than 17%.

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.