Entergy Corp. subsidiary Entergy Arkansas Inc. and Union Power Partners LP, a project affiliate of Panda Energy International Inc., Dallas, have signed an interconnection agreement allowing the Panda subsidiary to transmit bulk power from a new merchant plant over Entergy's transmission system beginning in 2002.
Panda says the agreement is another milestone in the development of the 2720 Mw El Dorado plant in El Dorado, Ark. The plant will be the largest 100% merchant power plant ever built in the US.
Garry Hubbard, senior vice-president of merchant plant development for Panda, said the agreement will allow the facility to interconnect with Entergy's bulk transmission system permitting sales of electricity and ancillary services to wholesale power customers. Panda said it would contribute several million dollars worth of new transmission system equipment to Entergy to allow its bulk system to accommodate a facility of El Dorado's size and scope.
The agreement was negotiated following extensive modeling and analysis by Entergy Services Inc., which demonstrated that the facility design was sufficient to meet or exceed accepted industry standards for reliability and safety, said Lloyd Kolb, Panda senior director of transmission and services.
Site preparation for the plant has been completed, according to the company. Construction will start in late fall, and the first phase of the plant is scheduled to go on line in the spring of 2002.
Panda said 20% of the plant's capacity, up to 500 Mw, was contracted last March to Dynegy Inc.
Earlier, affiliates of Panda and El Paso Energy Corp. signed interconnection and transportation agreements to supply the fuel needs of the new plant. That deal included Union Power Partners, Panda's project affiliate, and its pipeline affiliate, Trans-Union Interstate Pipeline LP, along with Gulf States Pipeline, a subsidiary of El Paso Field Services, the midstream business unit of El Paso Energy.
Panda said Trans-Union would build a new 42-mile, 30-in. diameter pipeline, connecting the El Dorado plant with the Gulf States Pipeline in Sharon, La. When completed, the plant will use about 430,000 MMcfd of natural gas, transported by Union Power Partners from various gas basins in Texas, Louisiana, and Oklahoma, officials said.
In a related move, Union Power Partners also signed firm transportation agreements with Tennessee Gas Pipeline Co., a business unit of El Paso Energy.Required documentation, including detailed environmental and cultural impact studies, were filed with the Federal Energy Regulatory Commission in December; the companies said.