Duke's California power project wins approval

Duke Energy Corp. received the go ahead to build the controversial 1,060 Mw Moss Landing power plant from the California Energy Commission Wednesday, the sixth plant approved since the state's electricity market was restructured in March 1998.

Tom Williams, a Duke spokesman, said beginning construction Monday is contingent on receiving a water permit Friday.

In approving the $500 million combined cycle natural gas-fired project, the commission said Moss Landing complied with rules on environmental impacts, public health and safety, air quality, and hazardous materials. The energy commission began its review in August 1999.

Under the license, project owner Duke Energy will pay $7 million to mitigate the potential impact of the power plant's operations on the area's marine biology. The facility will be located near the Moss Landing Harbor in Monterey County.

The commission also required Duke to pay $425,000 to the Monterey Bay Sanctuary Foundation to fund a coastal waters evaluation program. These funds will be used to evaluate the effects on biological resources in the bay, resulting from the power plant's thermal discharge. Duke will pay the foundation $150,000 within 90 days of Wednesday's vote, and a final payment of $275,000 within 90 days of the start of commercial operation of the first new unit.

In all, Williams said, Duke will pay about $15 million in mitigation costs, including purchasing fire trucks for a local fire district.

The Moss Landing plant will replace existing electrical power generation Units 1-5, which have a total capacity of 613 Mw. The five units, built in the 1950s and taken out of operation in 1995, will be replaced by two combined cycle units consisting of gas-fired combustion turbine generators, two unfired heat recovery steam generators, and a reheat, condensing steam turbine generator. Each of these units will use seawater for once-through cooling.

The project is scheduled to be online by the summer of 2002 when it will increase the total generating capacity of the Moss Landing plant to about 2,590 Mw.

Currently, Duke has 3,351 Mw of generating capacity in California. The addition of the Moss Landing project will bring the total to 4,044 Mw. Williams said Duke plans to sell the power in the forward markets.

"We think it is prudent for utilities to buy in the forward markets," he said.

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