Talen Energy (NYSE: TLN) said June 7 that it has completed a feasibility assessment related to bringing natural gas to the Montour plant in Pennsylvania and installing boiler modifications to enable a dual-fuel (co-firing) capability.
The company’s Board of Directors approved the project, which will enable the Montour plant to operate on coal, natural gas or a combination of the two. Engineering and design work is already in progress and, based on obtaining all necessary permitting and regulatory approval, the anticipated completion date is the second quarter of 2018.
Based on the results of a competitive request for proposals (RFP) process, the company is currently selecting a qualified third party to construct, own and operate a 15-mile lateral pipeline to bring natural gas to the 1,500-MW Montour plant. The estimated capital expenditure for plant modifications is approximately $70 million with additional pipeline expenses and payments to be made to the third party constructing the pipeline and regulating and metering station.
“Montour is a significant asset in the Talen Energy fleet and we are making the necessary investments to improve its competitive position in the market,” said Paul Farr, Talen Energy President and Chief Executive Officer. “The Montour plant is located in close proximity to one of the largest natural gas formations in the world, the Marcellus Shale. Co-firing the plant to burn natural gas, produced in Pennsylvania, enables Talen Energy to leverage the strategic location of the plant.”
The pipeline company selected by Talen Energy will be responsible for obtaining all necessary environmental and construction permitting from the appropriate federal, state and local agencies. Talen Energy expects to announce additional details related to the pipeline, contractor and next steps as part of its typical quarterly reporting as those details become available.
The Montour LLC unit of Talen Energy on May 11 notified the Federal Energy Regulatory Commission of a material change in facts related to its exempt wholesale generator (EWG) status due to new leasing and fuel procurement arrangements for the Montour plant. The company has contracted with an unaffiliated refined coal producer, Montour Refined Coal LLC (MIRC), to supply a refined coal product to the power plant for use as fuel. Montour granted MIRC a license to install, own and operate a refined coal production facility at the power plant, together with the right of ingress, egress and access through and over the private roads and driveways adjoining the facility.
Also, Talen Energy said in its May 10 quarterly earnings report that a key strategic objective that continues on schedule is the natural gas co-firing project at the 1,500-MW Brunner Island coal plant in Pennsylvania. The company expects gas co-firing capability for the 750-MW Unit 3 to be completed in the third quarter of 2016. Co-firing of Units 1 and 2, which have a combined generating capacity of 750 MW, is on schedule for completion by the end of 2016. The company said it has commenced construction on a four-mile gas pipeline to the 1960s-era plant to support the co-firing project.
Brunner Island and Montour are very similar plants that Talen got from PPL Corp. (NYSE: PPL).
Talen Energy is one of the largest competitive energy and power generation companies in North America. The company owns or controls 16,000 megawatts of generating capacity in well-developed, structured wholesale power markets, principally in the Northeast, Mid-Atlantic and Southwest regions of the United States.