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Pennsylvania Breaks Ground for 829 MW Marcellus Power Plant

Dallas-based private equity firm Panda Power Funds LP said on Thursday it had officially broken ground on one of Pennsylvania's first power plants to be fired with natural gas from the Marcellus Shale.

The firm's Liberty generating station will use state-of-the-art gas turbines provided by Siemens Energy Inc. to generate 829 MW of electricity that will be capable of supplying the power needs of 1 million homes in Pennsylvania once commercial operations begin in early 2016.

Panda Power welcomed Republican Gov. Tom Corbett and other officials from across the state on Thursday to participate in a groundbreaking ceremony. Thus far, Pennsylvania has approved about 10 natural gas-fired power plants (see Daily GPI, May 20, 2013), but no others have yet started construction. Most of those are planned for the eastern part of the state near an area of heavy dry gas production in northeast Pennsylvania.

In 2012, Moxie Liberty LLC, a subsidiary of Virginia-based Moxie Energy LLC, earned approval from the Pennsylvania Department of Environmental Protection for its air quality plan to construct the plant (see Shale Daily, Oct. 12, 2012). Last year, Moxie Energy completed the sale of its controlling interest in Moxie Liberty to Panda Power, which secured the more than $800 million in financing for the Liberty generating station (see Shale Daily, Aug. 23, 2013).

The plant will be located in Asylum Township, Bradford County, one of the leading counties for Marcellus Shale dry gas production in Pennsylvania. Panda said 500 jobs will be created to construct the facility and another 27 positions will be created to run it. The power generated there will feed PJM Interconnection, which coordinates the movement of electricity in 13 states and serves about 60 million people.

PJM has indicated that it is in need of new generating capacity as approximately 20,000 MW of coal-fired power generation is expected to be retired within its system by 2016.

As coal continues to face stiff federal regulations and competitive pricing from soaring onshore natural gas production, more power generators are expected to make the shift to natural gas to produce electricity. The Energy Information Administration has also estimated that by 2020, 60 GW of coal-fired power will be retired across the country (see Daily GPI, March 20).

Panda said its Liberty generating facility would be among the cleanest gas-fired plants in the nation. Unlike the majority of similar facilities across the country, the Liberty plant will be cooled with air rather than water, eliminating the need to draw from or discharge into the nearby Susquehanna River.

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