NRG Energy plans to build a new peaker plant next to the site of the Carlsbad’s Encina Power Station, a move aimed at replacing lost power due to the closure of the San Onofre Nuclear Generating Station.
The natural gas plant would generate 600 megawatts of electricity from a facility just east of the existing plant, which would be dismantled as the new plant comes online.
NRG is working to secure the necessary permits from the state’s Energy Commission to amend an earlier approved project at the 23-acre site, said Jeff Holland, a company spokesman. In January, NRG, which owns and operates the Encina plant, entered into an agreement with the city of Carlsbad and San Diego Gas & Electric to build the peaker plant, which will have a lower profile, produce fewer emissions and be a more efficient generator.
Holland and a spokeswoman for SDG&E confirmed that the parties are negotiating on a power-purchase agreement that would help replace the generation produced at San Onofre, which ceased operations in January 2012 because of radiation leaks within newly installed turbine engines. A year ago, Southern California Edison, the majority owner of the San Onofre plant, decided to shut it down.
City Now Backing Plant
SDG&E notified the state’s Public Utilities Commission in March it was in negotiations with NRG, following the PUC’s approval of the utility’s long-term procurement plan that authorized the purchase of up to 800 megawatts from new generation sources. The plan only required that SDG&E obtain at least 200 megawatts from renewable energy sources such as solar and wind.
The remaining 600 megawatts could come from any type of generation, and the utility company, a subsidiary of San Diego-based Sempra Energy, determined the best option was a new gas-fired plant, SDG&E spokeswoman Jennifer Ramp said.
For the city of Carlsbad, support for the peaker plant comes after the city was a plaintiff in several lawsuits seeking to derail NRG’s project, first proposed in 2007.
“It’s a different project,” said Gary Barberio, Carlsbad’s assistant city manager. Not only is the new plant smaller and designed to use more efficient technology, the agreement calls for demolishing the existing Encina plant, and assuming the costs for that, he said.
The agreement also entails the relocation of a nearby SDG&E maintenance yard and freeing up 16 acres on the city’s coastline.
If all goes according to plan, NRG would build the new plant and have it operating by late 2017 in advance of shutting down the Encina plant around the same time. Demolishing the old plant would begin within 12 months from the new plant coming online, and should be completed by the end 2020, Barberio said.
That’s assuming NRG obtains all the necessary permits and the project withstands litigation from some environmental groups that oppose building new power-generation facilities.
The Sierra Club San Diego chapter, among other environmental groups, has opposed building new power plants in the county, arguing that the region’s adoption of solar panels and the expansion of other renewable generation make building new plants unnecessary.
“We’re adamant that the evidence is there that proves gas plants aren’t necessary,” said Peter Hasapopoulos of the Sierra Club.
A 600 MW peaker plant would cost more than $3 billion when all the financing costs are added in over multiple decades, Hasapopoulos said.
NRG declined to provide an estimated cost for the project but said it would generate 280 construction jobs. In February, the PUC approved a 300 MW peaker plant for Otay Mesa called Pio Pico that recently began construction. Another peaker plant proposed to be built near Santee called Quail Brush was denied by the PUC in March 2013.
NRG is seeking to amend an already approved gas plant at the Encina site that would change the type of turbine engines used to generate electricity from combined cycle to single cycle. The latter type can be throttled up or down much quicker, making them more efficient to respond to fluctuating power needs, utility officials said