GOVERNOR URGES BOARD TO DELAY

By Austin R. Ramsey

Published Feb. 10, 2019 | Messenger-Inquirer

Kentucky Gov. Matt Bevin has called on the Tennessee Valley Authority to delay a Thursday

vote it has planned regarding future operations at the Paradise Fossil Plant in Drakesboro.

 

Speaking before a large crowd at Paradise Park in Powderly on Saturday, the governor said he and President Donald Trump are urging that vote not to go forward until all nine seats on the TVA Board of Directors are filled and until the Federal Energy Regulatory Commission completes a study it initiated last month on the resiliency of the U.S. electric grid.

 

Muhlenberg County has experienced a nearly decadelong economic slump as mines and power plants in the region are hit hard by increasingly competitive natural gas prices. Kentucky Utilities’ Green River Generating Station retired a few miles downstream from the TVA plant in 2015, and several mines in the area have closed down as well Bevin said closing Unit 3 would devastate not only Muhlenberg County, but it could have unintended consequences nationwide.

“It will pull the heart and soul out of this community,” he said. “Fifty percent of a single mine’s production goes into this plant. What’s it going to do to that mine? What’s it going to do to the people who work there — to the people who haul that material? The ripple effect of this is great.”

Unit 3 is the last remaining coal-burning unit at Paradise, which sits on the Green River about six miles east of Drakesboro. The TVA retired Paradise Unites 1 and 2 in April 2017 because of revised federal mercury and toxic air standards. They were replaced that same year with the Paradise Combined Cycle Plant to the north, a 1,100-megawatt natural gas plant capable of meeting

flexible energy production needs. Since then, the TVA has continued to monitor the remaining coal-fired unit at Paradise Fossil Plant, and, in November, released a report that recommended

its closure. It is nearly 50 years old and plagued with ongoing maintenance issues, the

report stated. Natural gas prices, it added, have remained consistently lower than those for coal.

 

But the polar vor tex that swept over much of the Midwest earlier this month was a perfect illustration, Bevin said, of how desperately our nation’s economy still relies on coal. Typically, coal is only responsible for about 28% of the nation’s total energy production, but, during February’s 72-hour cold snap, coal-based production nearly doubled.

Bevin explicitly told reporters after Saturday’s rally that he doesn’t believe he’s fighting a losing battle against coal plant closings because natural gas has not yet proven itself reliable enough when worst comes to worst. He used the polar vortex, terrorist attacks or even earthquakes as examples. But according to most independent system operators, peak load times simply delay what seems to be inevitable about natural gas production in the U.S.: As more gas becomes available, prices go lower.

Market metrics reveal that coal’s dominance during this month’s cold snap was more likely because of prices than supply. Coal was temporarily cheaper than natural gas, but as the gas supply continues to grow (and all indications are that it will), that may not be an issue in the future.

Congress has yet to approve Trump’s nominations to fill two vacancies on the nine-member TVA Board of Directors, and it’s likely he will stack the board with pro-coal supporters like Kentucky native and former Armstrong Coal executive Kenneth Allens, whom he appointed in January.

 

Meanwhile, FERC, the regulatory commission responsible for production oversight, denied a Trump request recently to help subsidize coal and nuclear costs that have both been hampered by natural gas prices. At the same time, however, FERC began a study to see just what impact plant closings could have on the overall grid, and Bevin told supporters Saturday that TVA needs to await its results.

“We need electricity to come on when we flip the switch,” he said. “There is no capacity right now if we shut this facility and others like it down to be able to provide what America needs.”

FINAL REPORT, POLITICAL INPUT SET STAGE FOR CRITICAL TVA VOTE

By Austin R. Ramsey

Published Feb. 13, 2019 | Messenger-Inquirer

The Tennessee Valley Authority has released its final environmental assessment of the Paradise Fossil Plant in Muhlenberg County, just days before a key decision the board of directors is set to make regarding its future.

 

A 350-page report released Monday found that closing the plant’s last remaining coal-fired unit, PFC UNIT 3, would have no significant impact on the TVA power service area, despite claims by several Republican state and federal officials this week that it could disrupt the national grid, especially during high peak times like the polar vortex earlier this month. 

 

At a massive rally in Powderly on Saturday, Kentucky Gov. Matt Bevin called on the TVA board to delay its vote, scheduled for Thursday, until at least two new members have been appointed and the Federal Energy Regulatory Commission has completed its own study on the impact consistently competitive natural gas prices are having on the coal and nuclear power markets. FERC denied a request by President Donal Trump to help subsidize those markets last month.

 

The president tweeted support for the Muhlenberg County power plant on Monday, saying: “Coal is an important part of our electricity generation mix and (TVA) should give serious consideration to all factors before voting to close viable power plants like Paradise #3 in Kentucky!”

 

Later, Senate Majority Leader Mitch McConnell, a Kentucky Republican, responded to Trump’s tweet, saying: “I agree Mr. President #Coal is ann affordable & reliable source of energy we can find right here in #Kentucky. It powers the lights in our homes & employs thousands of hardworking Kentuckians. Coal has helped fuel our country’s greatness & it needs to be part of our energy future.”

 

Unit 3, which employs about 130 people, is the last remaining coal-burning unit at Paradise, which sits on the Green River about six miles east of Drakesboro. The TVA retired Paradise Units 1 and 2 in April 2107 because of revised federal mercury and air toxic standards. They were replaced that same year with the Paradise Combined Cycle Plant to the north, a 1,100-megawatt natural gas plant capable of meeting flexible energy production needs. Since then, the TVA has continued to monitor the remaining coal-fired unit at Paradise Fossil Plant, and, in November, released a report that recommended its closure. It is nearly 50 years old and plagued with ongoing maintenance issues, the report stated. Natural gas prices, it added, have remained consistently lower than those for coal.

 

A Murray Energy Corp. mine is responsible for at least 50% of the fuel Unit 3 consumes and several other washing and hauling facilities rely on its operations there, not to mention the region’s economic interest in those jobs and the tax dollars they generate. 

 

“It’s not just me, but it’s the community,” said Tyler Allen, who works at a coal preparation facility that cleans fuel for the unit. “I think this is just a remnant of the war on coal that we have. It’s going to continue to get worse if we don’t do something about it. … In this area, c(coal) is a huge part of every job to most people. A lot of the people from this community work in the coal industry.”

 

Monday’s report, however, determined that, while closing the plant could have a moderate socioeconomic impact on Muhlenberg County, the remaining coal unit cannot keep up with national energy growth trends.

 

“TVA has considered load overlook, economic benefits and  cost, performance and environmental and social impacts and determined that there is no immediate need to replace the generating capacity currently provided by PAF Unit 3. ... TVA’s action … supports a low-cost, reliable, risk-informed, diverse, environmentally responsible and flexible power system.”

TVA BOARD VOTES

TO CLOSE PARADISE PLANT

By Austin R. Ramsey

Published Feb. 15, 2019 | Messenger-Inquirer

The Tennessee Valley Authority board of directors took a historic step on Thursday, voting 6-1 in favor of closing down the last remaining coal-fired unit at Paradise Fossil Plant in Muhlenberg County.

Following several tense moments of discussion at the TVA headquarters in Chattanooga, Tennessee, the board sided with a staff recommendation to retire the unit over the next two to four years, citing economic concerns over its age, ability to adapt to changing market conditions and cost competitiveness against natural gas and nuclear power resources.

 

The decision effectively closes one of the nation’s most recognizable coal-fired power plants and it threatens a legacy of coal in Muhlenberg County that stretches back nearly a century. The community of Paradise, atop which the plant was built in 1963, was memorialized eight years later in John Prine’s hit song of the same name. The first commercial load of coal ever hauled in Kentucky, in fact, came from a mine in Muhlenberg County just south of the McLean County border.

 

But despite the community’s rich history, largely built in the shadow of age-old smokestacks near the Green River, the TVA board on Thursday said Paradise has outlived its design and now costs the federally-owned corporation more to operate than its worth in power generation. It will be retired alongside the Bull Run Fossil Plant in Clinton, Tennesee.

“Let me tell you what this decision is not about,” said TVA President and CEO Bill Johnson. “It is not about coal. This decision is about economics. It’s about adhering to the legal requirements under the TVA Act. It’s about keeping rates as low as feasible. And it’s about the fit of these plants inside TVA’s portfolio to meet load. Continuing operation of these units well into the future would impose significant costs to our customers that can be entirely avoided with no impact to reliability, no impact to resilience and no need to replace these plants.”

Immediate savings on TVA customers is expected to be approximately $320 million, but taking into account future capital investments, those savings could top $1 billion, according to TVA Chief Financial Officer John Thomas III. The loss of nearly 1,500 megawatts worth of baseload through the U.S. Enrichment Corporation near Paducah plus an additional 1,500 megawatts of nuclear load capacity elsewhere in the system and several new natural gas combined cycle plants have rendered Paradise Unit 3 and the Bull Run plant obsolete, he said.

But the decision, whose only dissenter on the board was President Donald Trump-appointed and former Armstrong Coal executive Kenneth Allen, of Kentucky, did not come lightly, TVA officials said. 

Unit 3 employs about 130 people alone in Muhlenberg County. Staff said about 40 percent of those employees are eligible for retirement and the remaining will be given the option to join a corporate reassignment program. Still, the ripple impact on a community of slightly more than 30,000 people will be substantial, experts predict. 

"Any time you lose jobs in a community, it’s a tough thing to swallow,” said Muhlenberg Alliance for Progress Director of Business Development Gary Jones, “especially high-skilled, high-paying jobs like these. TVA has been a good corporate partner for many years; we don’t want to knock them or question their intentions, but we are disappointed."

The impact, he said, will be far-reaching.

"It will have an effect on everything — on our school system, our county government and the coal miners, truck drivers and other jobs we have. It creates a lot of turmoil I wish we didn’t have to go through,” he said.

Jones said he is currently negotiating with an industry that has shown interest in the Paradise Regional Business Park, which has sat empty for more than a decade.

Paradise Unit 3, in particular, had received 11th-hour support from high-profile advocates such as Kentucky Gov. Matt Bevin, U.S. Senate Majority Leader Mitch McConnell and even President Trump, but officials at TVA insisted that their responsibility was to lower costs to all 10 million customers in the Tennessee Valley, despite small-scale socioeconomic drawbacks. 

“Myself, my wife and my son all work in the mines,” said John Stringer, an employee of Murray Energy Corp. which owns a mine that supports the Paradise plant. “It will affect our jobs, our hobbies, our livelihoods. It will affect our entire lives.”

TVA officials said the Paradise footprint could be put to good economic development uses, perhaps even including a test site for advanced coal uses. Should a buyer express interest, the system would consider liquidating the property as well.

BEVIN LAMENTS TVA'S

PARADISE VOTE 

© 2020 by Austin R. Ramsey