Thursday, November 15, 2018
Business

Seminole Electric proposes $727M natural gas plant

Times staff and wires

State regulators will hear arguments in March on proposals for two new natural gas power plants in Putnam and Pasco counties that would supply electricity to customers of electric cooperatives throughout Florida.

Filings last week with the state Public Service Commission show a two-pronged strategy by Tampa-based Seminole Electric Cooperative, Inc., to help meet future power needs. Part of that strategy calls for building a $727 million plant; the cost of the other, smaller facility has not been disclosed.

"Based on its continuing evaluation of its member cooperatives’ electricity needs," Seminole said in the filing, "Seminole projects a need for 901 megawatts of additional generating capacity by the end of 2021."

Seminole is a nonprofit utility that provides wholesale power to cooperatives throughout the state to 1.6 million customers in Florida. Its members include the Withlacoochee River Electric Cooperative, Inc., which had about 223,000 accounts in 2016, including in Pasco and Hernando counties.

In a filing with Shady Hills Energy Center, the utility said it wants to build two combined cycle gas plants: a 1,050-megawatt plant at its already-existing site in Putnam County and contract for electricity generated at a 573-megawatt plant in Pasco County that would be owned by a subsidiary of General Electric Co. About 800 average-sized homes can be powered by a single megawatt.

"The combined cycle generation technology is one of the most efficient power production technologies available today," the utilities said in their filing.

Seminole Electric also has a proposal pending in the Florida Division of Administrative Hearings as it seeks a separate regulatory approval for the Putnam County project under a state power-plant siting law. Both new plants would be fueled with natural gas, and the strategy also includes shutting down a smaller coal-fired plant at the Putnam site north of Palatka.

The Putnam County project would rival that of Duke Energy Florida’s Crystal River plant in terms of energy output. Duke is in the process of building a combined cycle natural gas plant in Citrus County, like that proposed by Seminole. When it is fully operational at the end of 2018, it will produce 1,640 megawatts on average.

Related coverage: Duke Energy quietly builds a $1.5 billion plant in Citrus County>

It would be slightly cheaper, however, than the $1.5 billion Duke Energy project. Seminole estimates that the combined cycle plant would cost $727 million. Customers would likely see this in an uptick on their monthly bill. The monthly rates for customers differ depending on their provider in the cooperative.

In the petitions filed with the Public Service Commission, Seminole said it has a "significant need" for additional power in the 2021 and 2022 time frame. Much of the urgency comes from soon-to-expire agreements to purchase electricity from other utilities.

The new Pasco County plant, which would be adjacent to the existing Shady Hills power plant, would start operating Dec. 1, 2021, according to the filings. Seminole would have a 30-year contract to buy electricity produced at the plant.

Seminole, meanwhile, would start operating the Putnam County plant on Dec. 1, 2022, the filings show.

If the determinations of need are denied, Seminole said it would have to continue operating the coal-fired plant in Putnam County and would need to buy power at a higher cost.

"Non-approval would mean that Seminole’s members (electric cooperatives throughout the state) and the members’ retail member-consumers would be denied the most cost-effective, risk managed power supply solution," the petitions said.

Should they be approved, however, Seminole will retire one of its coal units within the next five years. Its retirement is expected to bring a 40 percent reduction in air pollutants produced by the collective, as well as a 34 percent reduction in carbon dioxide emissions and a 27 percent increase in power output.

In addition to Withlacoochee River, Seminole’s other members include Central Florida Electric Cooperative, Inc.; Clay Electric Cooperative, Inc.; Glades Electric Cooperative, Inc.; Peace River Electric Cooperative, Inc.; SECO Energy; Suwannee Valley Electric Cooperative, Inc.; Talquin Electric Cooperative, Inc.; and Tri-County Electric Cooperative, Inc.

Seminole’s proposals are part of a broader move in the state’s utility industry to build natural-gas plants and shut down older facilities. Florida Power & Light, for example, is seeking approvals for a new Dania Beach plant and has undertaken projects in recent years at Cape Canaveral, Riviera Beach, Port Everglades and in Okeechobee County.

The Public Service Commission has scheduled a hearing March 21 on key regulatory approvals — known as seeking determinations of need — for the projects.

Times Staff Writer Malena Carollo contributed to this report.

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