Indianapolis Power eyes spring 2017 startup of 671-MW Eagle Valley project

Indianapolis Power & Light has lately retired 260 MW of coal-fired generation, converted 630 MW of coal-fired generation to natural gas and will bring on-line a 671-MW Combined-Cycle Gas Turbine (CCGT) power station at its Eagle Valley site in spring 2017.

These projects, which are helping Indianapolis Power & Light (IPL) move towards a cleaner resource mix, are also the reasonable least-cost option to serve customers, said the utility in an integrated resource plan (IRP) filed Nov. 1 with the Indiana Utility Regulatory Commission.

IPL owns and operates approximately 2,700 MW of generation, including 1,100 MW fired by natural gas and 1,700 MW of coal. It is in the process of constructing 671 MW of CCGT capacity, supports 58 MW of demand-side management (DSM) resources, and secured power purchase agreements (PPAs) for approximately 96 MW of solar generation and approximately 300 MW of wind generation.

Under the terms of the PPAs, IPL receives all of the energy and Renewable Energy Credits (RECs) associated with the wind and solar PPAs which it currently sells to offset the cost of this energy to customers. However, IPL reserves the right to use RECs to meet any future environmental requirement, such as the EPA’s Clean Power Plan (CPP).

IPL prepared for U.S. Environmental Protection Agency regulations to improve air emissions and water quality by investing $1.4 billion in environmental controls and new generation. This investment program is expected to reduce SO2, NOx, mercury and particulate matter by over 50% in 2017 compared to 2013. Investments include retiring approximately 260 MW of coal-fired generation, refueling 630 MW of coal-fired units to natural gas at the Harding Street plant, upgrading controls at the big Petersburg coal plant to comply with the Mercury and Air Toxics Standard and the National Pollutant Discharge Elimination System rules and construction of the 671-MW Eagle Valley CCGT.

IPL has made great strides to diversify its portfolio by changing the fuel mix from 79% coal, 14% natural gas and 7% oil in 2007 to the projected mix of 44% coal, 45% natural gas, 1% DSM, and 10% wind and solar resources to IPL’s portfolio through Purchase Power Agreements in 2017. In addition, IPL refueled Harding Street units 5 through 7 from coal to natural gas and is constructing the new Eagle Valley CCGT.

IPL currently owns and operates these assets:

  • The Petersburg Generating Station (1,723 MW) in Petersburg, Indiana, includes four coal-fired units located in close proximity to its Indiana fuel supply to provide low cost energy to IPL’s customers. This plant is being retrofitted with environmental compliance equipment in accordance with regulatory requirements. The estimated ends of the useful lives of these four units are spread across the 2032-2042 period.
  • The Harding Street Generating Station in Indianapolis, Indiana, includes seven natural gas-fired units. Three of these are steam units recently converted from coal and four are combustion turbines. Because Harding Street is directly connected to the IPL load zone through its 138-kV transmission system, it provides an important capacity resource at the center of IPL’s service territory, thus reducing transmission costs and service interruption risk. In addition, the IPL Advancion Energy Storage Array is located at the Harding Street Station. This transmission asset is a 20-MW lithium ion battery providing frequency control services to maintain grid stability.
  • The Georgetown Generating Station in Indianapolis, Indiana, includes two natural gas-fired combustion turbines.
  • The Eagle Valley Generating Station in Martinsville, Indiana, is where IPL is constructing the 671-MW CCGT, which is scheduled to be operational in spring 2017. Coal-fired generation was recently retired at this location; however, transmission and substation assets are in the process of being upgraded to accommodate the new generation.

IPL has secured energy output from approximately 300 MW of wind generation under long-term PPAs. Additionally, IPL purchases the energy from approximately 96 MW of solar projects through IPL’s Rate Renewable Energy Portfolio (REP) program. IPL’s Rate REP is a pilot renewable energy feed-in tariff offering approved by the IURC that went into effect in March 2010.

According to the Environment America Research & Policy Center, IPL has the second largest per capita concentration of solar among U.S. cities to date.

IPL’s reserve margins are expected to exceed 15% following the commercial operation date in spring 2017 of the CCGT. This long capacity position is expected to be reduced as other IPL units are retired. The resource portfolios in this IRP target maintaining approximately 15% reserves throughout the study period.

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.