The Tennessee Valley Authority should not make the "huge mistake" of retiring the last remaining unit at its coal-fired Paradise power plant, Kentucky Gov. Matt Bevin said.
"The impact on our economy and our region's (and nation's) long-term energy grid reliability would be devastating," Bevin said in a Jan. 4 letter to TVA President and CEO Bill Johnson.
The federal entity is considering whether to retire two of its six remaining coal units: the Bull Run unit in Anderson County, Tenn., and the Paradise unit 3 in Muhlenberg County, Ky. The Bull Run unit, with a nameplate capacity of 950 MW, came online in 1967, while the Paradise unit with a nameplate capacity of 1,150 MW, came online in 1970.
Johnson in August 2018 described them as low-efficiency, high-cost assets, and an S&P Global Market Intelligence analysis showed them to be operating with little to no financial margin. Two other, older units at the Paradise plant were retired in 2017 and replaced with a more 1,160-MW combined-cycle gas plant, also called Paradise CC.
But Bevin said both Kentucky and the TVA region need the Paradise unit to remain a "viable part" of the energy infrastructure. The governor said he has "serious concerns" about how closing the unit could affect employees, people living in Muhlenberg and nearby counties, and Kentucky coal miners that supply fuel to the unit.
According to S&P Global Market Intelligence data, the Paradise plant's largest source of coal in 2018 was Murray Energy Corp. through its Genesis mine in Ohio County, Ky., and Pride mine in Muhlenberg County, Ky.
"In Kentucky we respect and value our coal-fired power plants and we strongly oppose any efforts to prematurely retire any of our fleet," Bevin said. "We have strong support, both in the Legislature and in the Executive Branch, for continuing to operate coal plants to power our burgeoning manufacturing economy."
Bevin also said conversations with President Donald Trump and members of his administration lead him to believe that utilities can expect a more "stable and practical regulatory environment for coal-fired power plants."
The U.S. Environmental Protection Agency is seeking to revamp Obama-era emissions plans, proposing to rescind the legal basis for the Mercury and Air Toxics Standards, or MATS, and to replace the Clean Power Plan for cutting carbon emissions from existing fossil fuel-fired power plants.
TVA has moved to decarbonize and strengthen its generation portfolio. Fiscal year 2018 saw TVA retire the Johnsonville and Thomas H Allen coal plants and replace the latter with a combined-cycle gas plant. The TVA also boosted capacity at its Browns Ferry nuclear plant, with more uprates scheduled.
TVA spokesman Scott Brooks said at the earliest, options for the Paradise unit's future could be presented to the utility's board at its Feb. 14 meeting.
A representative for Bevin did not immediately return a request Jan. 8 for further comment.