SRP Approves Arizona Expansion with 16 Gas-Fired Turbines

The board of directors of Arizona’s second-largest public utility has approved a nearly $1 billion plan to expand the natural gas-fired Coolidge Generating Station, adding 820 MW of generation capacity.

The Coolidge station at present is a 575-MW power plant with 12 single-cycle gas turbines; the plant began operating in 2011. The expansion plan approved Sept. 13 would add another 16 gas-fired turbines to the site.

The Coolidge station is operated by Salt River Project (SRP). The expansion plan was approved by an 8-6 vote of the utility’s board on Monday. The board also rejected a motion to table the decision for one month so the proposal and associated data could be analyzed.

The utility in an Aug. 24 presentation to the Salt River Project Power Committee said expanding the gas-fired plant would be more cost-effective than building carbon-free power generation under scenarios that included “low gas prices.” Mike Hummel, CEO and general manager for SRP, last month said, “Expanding our Coolidge Generating Station is a critical step in creating a reliability backbone for SRP customers. The added, rapid-start capacity at Coolidge will keep the lights on during times of peak electricity demand in the Valley and help support the variable output from SRP’s growing portfolio of renewable resources.”

Project Cost

SRP in that August presentation said it expects to spend $830 million to expand the gas power plant, but also said the utility is allowing for spending above that “for a total cost not to exceed $953 million.”

Monday’s vote came after several hours of public comments against the expansion from a variety of groups, including the utility’s ratepayers, the American Lung Association, Sierra Club, and consumer interest groups.

“The SRP Board made a nearly billion-dollar decision to build 16 gas units with ratepayer money without knowing the projected impact on monthly electricity bills or the total cost over time including fuel and maintenance,” said Dianne Brown, executive director of the Arizona Public Interest Research Group, in a statement. “The SRP Board, stakeholders, and customers remain in the dark about the inputs used for load forecasts and the specific factors and scenarios contemplated in the Coolidge Expansion Project [CEP]—which is not the way a utility should conduct business.”

Sandy Bahr, the Grand Canyon (Arizona) chapter director for Sierra Club, in an email to POWER wrote, “There are all kinds of reasons the SRP Board should have rejected this gas expansion, including the negative impacts on air quality and the high price tag for ratepayers, but ultimately, the main reason is that if SRP is serious about being on a sustainable path and helping to address climate change, it needs to have its actions match its words. Sustainability and climate goals are just not consistent with this continued reliance on fossil fuels, especially when energy efficiency, solar, and wind are so much cleaner and affordable.”

Increase in Energy Needs

SRP has said the proposed expansion “is needed to meet the significant near-term increase in energy needs in SRP’s service territory, which is among the fastest-growing regions in the nation. In addition, the CEP will enable the addition of more renewable resources [such as solar and wind] while maintaining a reliable power grid. The CEP will ensure that SRP can meet these objectives while staying on the path to achieve our deep decarbonization goals over the long term.”

SRP has said that based on the results of processes, including an internal review of operations, it plans to add LM6000 aero-derivative turbines from GE Gas Power to the Coolidge station.

SRP in an Aug. 27 statement about the project said, “the added natural gas generation at Coolidge would not impact SRP’s ability to meet its sustainability goals. SRP remains committed to reducing to reducing carbon intensity by more than 65% in 2025 and by 90% in 2050 from 2005 levels.”

Solar Power and Energy Storage

SRP has a goal to add more than 2 GW of solar power generation capacity to its renewable energy portfolio by 2025. The utility said that “with increased solar generation comes more variability in power output, especially during cloudy conditions. The CEP includes quick-starting [10 minutes] and fast-ramping power generation resources that can smooth out these fluctuations and ensure SRP delivers consistent, reliable power.” SRP also has said it plans to add 1,600 MWh of battery storage by 2023.

The utility has said an expansion of the existing Coolidge station “allows SRP to leverage the existing Coolidge Generating Station site and infrastructure while also ensuring a better balance of power generation located in the East Valley with power generation located in the West Valley. This will help to optimize the overall power transfer capability, reliability and flexibility of SRP’s transmission system.”

Environmental and consumer groups in their opposition to the project said SRP did not use a competitive bidding process that could have considered other generation resources. Salt River officials said they used an “internal review process” to configure the proposal, including information from an earlier RFP (request for proposals). The utility has said it plans to issue another RFP that would consider all generation resource types in the near future.

—Darrell Proctor is a senior associate editor for POWER (@POWERmagazine).