TVA to build $820M natural gas plant in Tenn.

The Tennessee Valley Authority on Thursday decided to build an $820 million....

The Tennessee Valley Authority on Thursday decided to build an $820 million natural gas power plant in northeastern Tennessee to comply with a North Carolina lawsuit over air quality.The 880-megawatt combined-cycle gas plant would be as large as the 1950s-era, coal-fired John Sevier plant in Rogersville that a federal judge has targeted for new pollution controls on North Carolina’s behalf."Retiring those (coal) plants is the right way to go," Steve Smith, director of the Southern Alliance for Clean Energy, told the TVA Board of Directors on Thursday. "As a general rule, we are supportive of natural gas ... because it is a cleaner fuel source than coal (and) has virtually no sulfur emissions."But the nation’s largest public utility isn’t talking about replacing any of its 11 coal-fired stations yet, TVA President and CEO Tom Kilgore said in a telephone interview from the board meeting in Young-Harris, Ga."That’ll be a decision to make in the future," Kilgore said. "But this gives us the insurance to be able to make a deliberative decision as opposed to trying to make it right now in short order."U.S. District Judge Lacy Thornburg ruled in January that four TVA coal plants in Tennessee and Alabama, including the John Sevier station, were fouling North Carolina’s air under a lawsuit brought by the state in 2006. He ordered them cleaned up by the end of 2011.TVA petitioned for an extra year, which the judge turned down. TVA recently filed notice it will appeal.The utility said the judge’s aggressive schedule could add $1 billion to the cost of upgrades and would be logistically difficult for John Sevier at the eastern end of its transmission system.TVA estimates John Sevier, with the capacity to light 350,000 homes, will have to be shut down for 20 months to install the pollution controls, risking power disruptions.So the TVA board agreed to postpone two projects of comparable worth — building a combined-cycle gas plant at TVA’s Caledonia site in Steens, Miss., and expanding a gas turbine plant at Gleason, Tenn. — and shift the work to a new northeastern Tennessee gas plant.TVA managers say they can get three gas turbines at the new plant online by the end of 2011, and a heat recovery system that will produce additional power by the summer of 2012. TVA is considering a site near the Sevier plant."I don’t want anyone to misunderstand this appeal to say we are not for clean air. We are," Kilgore told the board during the meeting, which was monitored via Webcast."We have spent about $6 billion over the last decade cleaning up the air," he said, noting significant reductions in air pollution have been made over the years. "The appeal does not mean that we are going to let up on this. We are going to continue to spend money to clean up our air."TVA supplies electricity to 158 distributors serving about 8.7 million consumers in Tennessee and parts of Kentucky, Alabama, Mississippi, Georgia, North Carolina and Virginia.