TVA Buys Chunk of Capacity on Columbia
A transportation agreement signed by Columbia Gulf and the
Tennessee Valley Authority (TVA) marks the beginning of a
relationship that is likely to grow over time as TVA converts a
significant amount of its generation capacity to burn natural gas.
The agreement covers firm transportation on Columbia for 240,000
MMBtu/d of gas that will fuel 1,500 MW of power generation at TVA's
Gallatin Power Plant in Sumner County, TN. But the plant represents
a small piece of a larger conversion process which will turn
another 20 generation units to gas usage over the next year.
The Gallatin conversion project will involve converting four
fuel oil units to burn natural gas. Columbia plans to build a
2.3-mile 12-inch diameter pipeline from mainline facilitates in
Wilson County, TN, to Gallatin.
It is Columbia's second agreement with a power generator. In
1996, the pipeline built facilities to deliver gas to two Central
Louisiana Electric Co. power plants. "Through connections with
these plants, we are moving toward Columbia Gulf becoming the
preferred platform for the eventual cross-commodity trading of
natural gas and electricity," said James W. Hart, Columbia Gulf's
vice president of commercial services.
Columbia Gulf President Terrance L. McGill said this TVA deal is
just a beginning. In all, TVA expects to have 2,296 MW of gas-fired
power operating by late 1999.
TVA also currently is seeking proposals from third parties to
provide up to 1,200 MW of additional peaking power by 2002 - 600 MW
by June 1, 2001 and 600 MW the following year. The power must be
supplied by simple-cycle gas-fired power plants located in the TVA
service area. TVA is not interested in owning the plants but would
pay a negotiated fee for an exclusive right to buy the power, a TVA
spokeswoman said. TVA plans to compare any proposals with a
possible TVA-built project.
The government agency has recommended converting its partially
constructed Bellefonte nuclear plant to burn natural gas, but
according to a spokesman, the Department of Energy has plans to
complete the construction of the plant as a nuclear generator for
production of tritium gas, which is used in nuclear arms
development. As a result, the agency will continue to seek out
proposals for additional gas-fired power.
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