The Tennessee Valley Authority (TVA) board on Thursday gave the federally owned corporation much-anticipated authorization to complete a nuclear unit at the federally owned corporation’s Bellefonte site near Scottsboro, Ala. However, the TVA may reportedly finance the $4.9 billion completion by selling and leasing its Watts Bar Unit 2 reactor—a project expected to be completed in 2013—as well as its John Sevier combined cycle gas plant.

The sale of Watts Bar 2 would be the first time the TVA would have sold a nuclear reactor, reported the Chattanooga Times Free Press. The gas plant could earn TVA up to $1 billion while Watts Bar could bring in $2.5 billion. Kim Greene, TVA group president of strategy and external relations, told the newspaper that the TVA had “indications from the market that there would be an appropriate amount of interest in the Watts Bar Unit 2 facility."

These plans follow the board’s approval on Thursday to increase the TVA’s average wholesale rate, effective Oct. 1, by 2%. The average increase amounts to about $1.60 a month on a 1,000 kWh residential electric bill. It was justified, the board said, because the corporation needed to make “nuclear safety modifications [to Bellefonte and its other nuclear facilities] as a result of Fukushima, bolster cyber-security and continue investing in clean-air initiatives and energy efficiency.”

"As we build Bellefonte we will integrate safety modifications from the extensive review of the lessons learned from the Fukushima nuclear plants in Japan," TVA CEO Tom Kilgore said. "Making Bellefonte a productive asset with state-of-the-art equipment will add an additional supply of clean, base-load power to TVA’s generating mix."

The board also approved the purchase of a combined cycle gas plant in north Mississippi and announced plans to add emissions controls at Gallatin and Allen fossil plants to reduce sulfur dioxide and particulate emissions.

The Magnolia Combined Cycle Gas Plant that TVA will buy it a three-unit, 909-MW natural gas-fired electric generating plant near Ashland, Miss. The air-quality controls, including flue gas desulfurization systems, or scrubbers, at Allen and Gallatin will take about six years to complete.

Construction of the two-unit Bellefonte nuclear plant began in 1974, but work was suspended in 1988 in response to declining demand. Unit 1 was the furthest along, considered about 90% complete when work halted in 1988. Today it is considered about 55% complete due to the transfer or sale of many components and the need to upgrade or replace others.

From 1992 to 2002, the TVA considered various proposals for Bellefonte, including completion as a combined-cycle natural gas plant, a coal gasification plant, a tritium production plant for the Department of Energy’s nuclear weapons program, or a nuclear plant partnered with a private investor. In 2009 the NRC granted the TVA’s request to reinstate Bellefonte’s original construction permits so the TVA could evaluate the engineering and economic feasibility of completing Units 1 and 2.

The TVA has said it remains interested in potentially licensing one or more advanced nuclear reactors at the site and continues to support the NRC’s licensing of the Westinghouse AP1000 technology.

The TVA decided to complete construction of the $2.5 billion Watts Bar 2 project in August 2007 to help meet its growing demand for power. The 1,180-MW Unit 2 will be the first new reactor to achieve commercial operations since Watts Bar 1 was completed in 1996.

Sources: POWERnews, Chattanooga Times Free Press, TVA