TVA signs contract for generating plant

Will replace Allen facility in Southwest Memphis

Tennessee Valley Authority officials on Friday signed a $452 million contract with the contractor that will build a natural gas-fired generating facility to replace the aging Allen Fossil Plant in Memphis.

Kiewit Power Group Inc. of Lenexa, Kansas, will begin construction late this year or early next year on a site just south of the Allen facility in the Ensley Bottoms area of Southwest Memphis, TVA spokesman Chris Stanley said. Completion is set for June 2018.

Including the cost of combustion turbines and other equipment already purchased by TVA, the price of the new plant is $975 million. Stanley said the construction will pump $233 million into the Memphis-area economy.

With a capacity to generate 1,070 megawatts, enough power for more than 580,000 homes, the natural gas plant will be a highly efficient combined-cycle facility. That means it will have combustion turbines generating power as they spin, but there will be additional electricity produced from the hot exhaust gases.

At Allen, which was built by Memphis Light, Gas and Water Division in 1959 and purchased 25 years later by TVA, the three coal-fired units have a net generating capacity of 702 megawatts, with an additional 456 megawatts available for peak demand periods from 20 gas-fired combustion units.

The new plant will create far less air pollution than Allen, according to TVA estimates. Emissions of carbon dioxide, a contributor to global warming, will be 60 percent lower than those from Allen, while nitrogen oxides, an ingredient in smog, will drop by 90 percent, and releases of sulfur dioxide will plummet to almost nothing.

The contract signing is the latest step in a process that began four years ago, when TVA entered into agreements settling alleged Clean Air Act violations at Allen and other coal-fired plants. The agreements, with state and federal regulators and environmental groups, required TVA to either retire the plants or equip them with costly pollution-control equipment by December 2018.

Last August, the TVA board of directors unanimously agreed to retire Allen and replace it with a gas-fired facility.

Stephen A. Smith, executive director of the Southern Alliance for Clean Energy, said his group supported retiring the Allen plant, but TVA should have opted for a smaller natural gas facility. “We don’t feel they need that large a plant,” he said.