Reliant nears completion of clean coal power plant

Reliant nears completion of clean coal power plant

March 15, 2004

New York - Independent power producer Reliant Resources Inc. said Friday it had almost finished the construction of its $800 million Seward waste coal-fired plant in Pennsylvania.

Reliant, of Houston, expects the 521-megawatt plant to enter service in about the third quarter of 2004, which includes the peak summer demand months of July and August.

The facility, located in East Wheatfield Township about 50 miles east of Pittsburg, uses a clean-coal technology called circulating fluidized bed to burn waste coal.

Over the project's life, Reliant has said the plant will burn more than 100 million tons of waste coal, which is a significant source of acid discharge in western Pennsylvania watersheds.

Because Seward will help solve the negative environmental impact of waste coal, the state and conservation groups supported the project. At the plant's groundbreaking, Reliant said in a statement Pennsylvania provided about $400 million in tax-exempt bonds to help develop the site.

French engineering firm Alstom and Duke/Fluor Daniel were the primary contractors for Seward. Duke/Fluor is a power contracting partnership owned by energy firm Duke Energy Corp. of Charlotte, North Carolina and engineering firm Fluor Corp, California.

Late last year, Reliant retired two coal-fired units with a capacity of 196 MW at Seward in anticipation of the start-up of the new plant. The old units were built in the 1950s.

The new Seward plant is one of the few coal-burning units built in the United States in recent years.

Over the past decade, most power plants built in the United States burn natural gas as their primary fuel because gas is a cleaner burning fuel and it is generally cheaper and easier to persuade state regulators to approve the construction of a new gas-fired plant, compared with other fossil fuel, nuclear and hydropower facilities.

The $800 million price tag for Seward, however, cost Reliant about $1.5 million per megawatt, well above the estimated $500,000 to $1 million per megawatt it usually costs to build a new gas-fired facility.

Once built, however, the operating costs of a coal-fired plant have historically been much cheaper than operating a gas-fired plants because coal costs less than natural gas.