Michigan Community Rejoices over Proposed Combined Cycle Plant

When a project as big as a major combined cycle power plant is announced in most places, the reaction is often mixed, if not outright negative. Concerns about noise, construction impact, and air pollution often dominate the public discussion both at the outset and throughout the development process. If the plant owner is unlucky, litigation is often involved.

But when Michigan utility Consumers Energy announced on Dec. 14 that it was replacing its old nine-unit, 214-MW combustion turbine peaker station in Thetford Township outside Flint with a modern 700-MW combined cycle plant, the reaction could best be described as restrained jubilation. 

Local government officials, community groups, and citizens all cheered the news. As Thetford Township Supervisor Eileen Kerr told the local media, "Saying I’m thrilled would be an understatement."

Jobs, Jobs, Jobs

The reaction is largely due to the 600 skilled construction jobs that the project will bring to the economically depressed Rust Belt community. Unemployment in the area hit 16% during the 2009 recession and is still well over 10%.  Worse, many of those jobs—career positions lost as manufacturing has left the area—are not coming back. 

The $750 million project, set to begin construction in 2015 and come online in 2017, is expected to give a significant economic boost to the area, both in direct jobs and indirect impacts. Even better, Consumers’ long-term plan includes a second pair of units to be built at a later date.

The 272-acre Thetford Township site has been home to the Thetford Generating Station since 1969, which means the new plant will be able to take advantage of the existing high-pressure gas supply and electric transmission lines. The old Thetford station has been mothballed for several years because the demand for peaking capacity in the area has declined. The design of the two-unit plant is still being finalized, but Consumers is projecting that it will use 3,000 MBtu to 4,260 MBtu per hour, depending on load conditions (Figure 1). Though the larger plant will mean a bigger footprint in the immediate neighborhood, the plan includes modern noise suppression equipment to reduce the impact. Once in operation, the plant will offer 30 permanent jobs for the community. 

1. This rendering shows the planned two-unit combined cycle plant slated for Thetford Township, Mich. Courtesy: Consumers Energy

Consumers Energy, which provides power and natural gas to 6.8 million lower Michigan residents, still needs to clear some hurdles before the project can begin. First, it needs an air permit from the Michigan Department of Environmental Quality (MDEQ), which it filed for on the day of the announcement. Once that permit is issued, Consumers needs a certificate of necessity from the Michigan Public Service Commission (MPSC); the application for that is expected to be submitted in 2013 after the MDEQ permit is obtained. 

Big Plans

John Russell, president and CEO of Consumers, said the plant is part of the company’s Balanced Energy Initiative, a comprehensive plan to meet the energy needs of its customers over the next 20 years.

“This proposed plant will use state-of-the-art technology to help meet the future needs of our 1.8 million electric customers in an environmentally responsible manner. Vast new supplies of natural gas have reduced prices and they are expected to stay low for the long term. We selected natural gas as the fuel source for this new power plant because we project it will be the most economical way to serve our customers in the future and continue to bring them value,” Russell said.

The $750 million cost will be in addition to the $6.5 billion that Consumers had previously planned to invest in its utility operations through 2017. The plan comes after Consumers cancelled plans for a $2.3 billion coal plant near Bay City and announced that it would retire several of its smaller coal-fired units last year in the face of impending emissions regulations from the U.S. Environmental Protection Agency.

The other major hurdle, of course, is obtaining sufficient financing for construction, but Russell is optimistic. 

“Michigan has a forward-looking energy policy that is designed to provide families and businesses with the energy and the energy infrastructure they need in the future,” he said.  He said Michigan’s 2008 energy law put a comprehensive energy policy in place that gives Consumers Energy and other utilities the financial certainty and regulatory structure that they need to make major investments. Among other changes, the new law streamlined the application process and reduced the chances of the project being held up after permits are issued. Previously, changes in membership of the MPSC sometimes meant previous permits could be revoked even after development was well along.

—Thomas W. Overton, JD is POWER’s gas technology editor. Follow Tom on Twitter @thomas_overton.

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