CP&L Replaces Palmetto With New Project
Letting no grass grow under the feet of its newly-created Carolinas
empire, Carolina Power and Light (CP&L) got a jump on competitors by
shortening both the length and the lead-time of its proposed interstate
Palmetto Pipeline project and turning it into an intrastate. The pricetag
on the project drops from $175 million to $100 million and it will run
82 miles (instead of 175 miles) along the right-of-way of now-integrated
North Carolina Natural Gas to a new power plant being developed by CP&L.
It will require no federal or state certification.
The new pipe will run between Iredell and Richmond counties to serve
an electric power plant soon to be under construction. If CP&L gets
its way, the new pipe will be in service by the spring of 2001.
Tom Kilgore, CP&L's senior vice president for power operations,
said the Iredell-Richmond pipeline meets the company's goals of reliability
and cost- efficiency. "This plan accomplishes those goals and will
provide a long-term, expandable gas supply to fuel much-needed electric
CP&L said it filed a notice earlier this week with the state Utilities
The proposed pipeline will extend from Williams Energy's Transcontinental
interstate pipeline in Iredell County to the Richmond County tract where
CP&L currently maintains an electric transmission substation. The 30-inch-diameter
pipeline will have an initial capacity of 200 MMcf/d with a total capability
of 700 MMcf/d. The project does not need FERC or state commission approvals
but will have to meet environmental regulations.
It is scheduled for completion during the spring of 2001 to coincide
with the start-up of the Richmond County power plant. The site will be
expanded to accommodate construction of additional natural gas-fueled combustion
turbine generation after 2001, CP&L said.
CP&L purchased NCNG in the fourth quarter of last year (see NGI, Nov. 16, 1998).
The new pipeline project replaces a plan for the 175-mile Palmetto Pipeline
that CP&L and Southern Natural Gas had been assessing. That joint venture,
announced in March, would have entailed building a pipeline from Aiken
County, SC, to Robeson County, NC. That project met stiff competition from
projects pursued by Scana Corp. and Williams Transco (see NGI,
April 19), which are still in various levels preliminary work.
Steven Hughes, a CP&L spokesman, said this new project will not
compete with the Scana and Transco projects. "We will own 100% of
the capacity on this pipe and the gas will serve CP&L power stations.
There is no plan at this time to open the pipe to the retail market."
Transco, however disagreed. Its Sundance Pipeline project aims to serve
the same power market, said Transco spokeswoman Paula Delaney. "We're
still going ahead with Sundance," she said. "And we'd really
like to serve those power plants."
CP&L has announced significant expansions into the natural gas industry
in recent months, with plans to add 4,000 MW of natural gas-fueled electric
generation by the end of 2002 and 7,000 MW by 2010. That represents a 70%
expansion in its electric generation system from the current level. In
addition to generation sites in Richmond and Rowan counties, CP&L is
building natural gas-fueled power plants at two existing CP&L coal-fired
power plant sites, in Wayne and Buncombe counties. CP&L will continue
to assess sites in the Carolinas for future power plants.
In related news, CP&L is moving ahead with plans to develop a transmission
system along with the Albermarle-Pamlico Economic Development Corp. (APEC)
for 14 currently unserved counties in Northeast North Carolina. Last month,
the energy company and APEC filed for $186 million of a $200 million state
bond package the state government had previously offered to entice companies
to build a transmission system in the region (see NGI,
April 12). Five other companies have also expressed interest in the
bond package proposal.