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Mon June 9, 2014
Tradinghouse Power Plant Demolished, What's Next?
The old Tradinghouse power plant was demolished Friday morning. Luminant owns the plant and property and they have permits to build a new natural gas combustion plant…but they’re waiting for market conditions to improve. With the EPA trying to cut back greenhouse gases, and natural gas production at an all-time high, isn’t this a great time to build a plant? Maybe.
R.W. Scott worked as a supervisor of operations at the plant from 1969 til 1987. He came to the demolition this morning a bit nostalgic for the place. He said there were a lot of good people who worked there…a lot of good memories of the power plant that sat on the edge of Tradinghouse Lake, warming the waters that became a hotspot for fisherman.
"Got to sit and watch them on the turbine deck right here when the state put the bass in this lake and they flew over it with a big airplane and the Bombay doors opened and it just rained fish you could see them falling out of there and then it just took off," Scott said.
Luminant closed the gas-fired power plant in 2010 because the facility had aged out—it just wasn’t efficient enough anymore. However, the company hasn’t sold the property. They’ve actually been granted an air permit from the State of Texas to build two new natural gas combustion turbines on the site. Seems like a great move right? Natural gas plants don’t produce as many greenhouse gases as coal-fired power plants. And with the EPA announcing that they’re trying to reduce greenhouse gas emissions 30% by 2030, natural gas production seems like a good place to put your money. But it’s not so simple. Luminant spokesman Brad Watson says the company’s holding back on construction.
"Right now though in Texas we have low wholesale power prices, which really don’t create the financial incentive to build new generation but we want to be in a position to make a decision. If the situation for pricing improves," Watson said.
So what’s the deal? Wholesale power has been extremely low in Texas, partly because of how cheap natural gas is. Dr. Gurcan Gulen is an economist with the Center for Energy Economics at the University of Texas. He says the market isn’t looking very encouraging in terms of a company trying to make an investment in a new power plant. And the whole business with the EPA trying to reduce greenhouse gases? That doesn’t necessarily mean coal-fired power plants are going the way of the dodo.
"And on EPA’s GHE rule—there’s still a lot of uncertainty of that," Gulen said. "The rule sounds quite aggressive, but it’s not really incumbent on the power plants to meet that goal by themselves. There’s some flexibility in the rule."
Gulen says nothing’s settled with the EPA rule yet. They could tell the states they can meet the reduction by energy efficiency/conservation on the demand side, increased use of renewables and so on and so forth. So it’s possible we might not have to shut down thermal plants, just reduce operations.
Long story short, it’s unclear now. Luminant, along with a lot of other energy companies and states, are still studying that rule. As for R.W. Scott, he just misses his old Tradinghouse gasfire plant, which Has gone the way of the dodo.