Tampa-based TECO Power Services and Panda Energy International announced on Thursday that they have begun initial construction and site preparation work on their 2,300 MW Gila River power station in Gila Bend, AZ. The companies will build the project under a joint venture agreement.

The natural gas-fueled facility will be brought into service in four phases. The companies said the Gila River power station will be interconnected with the Palo Verde substation, with plans to sell electricity to wholesale customers throughout Arizona, with excess energy available to customers in Southern California, Nevada and New Mexico.

TECO Energy’s Power Services subsidiary (TPS) announced in November of 2000 that it was buying a stake in two huge gas-fired merchant power plants being developed by Dallas-based Panda Energy (see Daily GPI, Nov. 15, 2000). Subsequently, the companies announced a joint venture on the Gila River plant and an additional one to be located in El Dorado, AR. The plants are expected to have a combined capacity of 4,600 MW. They are projected to cost $2.3 billion to build. Teco’s equity commitment is $960 million.

TPS Senior Vice President of Marketing and Development Michael Schuyler said, “This project continues to progress on schedule. For TPS, the Gila River project will be one of the largest facilities in our generating portfolio. We look forward to providing needed energy to the fast growing region of the country it will serve.”

Contractors are on site at the facility, preparing the area for full construction, which is set to begin in August. The project is scheduled to begin full commercial operation in the summer of 2003.

Panda Senior Vice President of Development, Engineering, Construction Garry Hubbard said, “The commencement of site preparation at Gila River is a major milestone for this project. It demonstrates our continued commitment to the Arizona power market. This is truly an exciting time for Panda and the customers we will serve through this facility.”

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