What is a combustion turbine unit?
A combustion turbine (or CT) generating unit is used to supply power during peak demand periods when electricity use is high,
and also can aid in the restoration process following a hurricane by providing a local source of generation. CT units start quickly and while they are mainly used short-term to meet temporary energy needs, they also are capable of operating for extended
periods of time. The CT proposed by Entergy New Orleans, Inc. is also known as the New Orleans Power Station.
Where will the New Orleans Power Station be located?
It will be located in an industrial area on the eastern edge of New Orleans at the same company-owned site as the deactivated
Michoud plant. This site was identified as optimal considering factors such as proximity to fuel supply, existing infrastructure,
site suitability and that it provides more reliability than alternatives considered.
Why does New Orleans need the New Orleans Power Station?
Entergy New Orleans is committed to providing reliable and affordable energy for a growing city today and tomorrow. The technology chosen for the generation of that energy also must be reliable and affordable. The June 1, 2016 deactivations of the
1960s-era Michoud units 2 and 3, which were driven by economic decisions based on maintenance and operational issues,
resulted in the loss of approximately 781 megawatts of local generating capacity. As a result, Entergy New Orleans has a need
for overall capacity as well as a need for local peaking and reserve capacity resources here in Orleans Parish.
While the acquisition of the highly efficient Union Power Station Unit 1 near El Dorado, Arkansas, and the purchased power
agreement with Entergy Louisiana’s Ninemile 6 generating unit in Westwego help offset a substantial portion of New Orleans’
overall need, the company still has a need for capacity, including a substantial need for peaking and reserve resources.
What is the estimated cost and timeline?
The estimated cost of the New Orleans Power Station is $216 million and it is expected to be operational in the second half of
2019. Entergy New Orleans is seeking council approval of its request by Jan. 31, 2017.
What is the economic impact?
Construction of the New Orleans Power Station is expected to generate nearly $206 million in new business sales in Orleans
Parish, more than $28 million in new household earnings for parish residents, an average of 92 jobs per year and pump nearly
$983,000 in new sales taxes into the Orleans Parish treasury.
How does the New Orleans Power Station fit into the Integrated
Resource Plan?
Entergy New Orleans’ Integrated Resource Plan (or IRP) report was filed Feb. 1, 2016, and came out of a process that included numerous public meetings and over 18 months of input from stakeholders representing a wide range of viewpoints. The key
conclusion of the company’s IRP report is the preferred portfolio that reflects a balanced and reasonable plan for reliably meeting customers’ needs over the next two decades at the lowest reasonable cost.
As a result, a local CT generating unit was found to be the lowest-reasonable-cost resource addition capable of meeting the
company’s overall capacity needs and a substantial portion of the identified peaking and reserve capacity need. This is the first
time in more than 30 years that Entergy New Orleans has asked the New Orleans City Council to approve the construction of a
local generating unit. The IRP process is ongoing and the council is expected to consider the company’s IRP in late 2016.
What is the environmental impact?
The New Orleans Power Station will use newer, more-efficient technology than the recently deactivated Michoud units 2 and 3.
That means that the New Orleans Power Station will produce significantly lower emission levels than the recently deactivated
units.
While Entergy New Orleans does not believe any material impacts resulted from groundwater usage by the deactivated Michoud
units, the New Orleans Power Station will result in a substantial decrease in the capacity for groundwater usage when compared
to those recently deactivated units. Considering the absolute minimum possible groundwater usage, there is expected to be a
reduction of 90 percent in comparison to the deactivated Michoud units. And considering the maximum expected groundwater
usage for the New Orleans Power Station, there is expected to be a reduction of approximately 99 percent.
What about renewables?
Renewable resources such as wind and solar are intermittent as they rely on wind and the sun to produce energy, thus limiting
the ability to rely on them to meet customer demand and their ability to be counted on to meet peak demands. As a result, renewables must be supported by dispatchable resources such as CT units to ensure sufficient resources are available to ramp
up and produce replacement energy when the wind is either not blowing or blowing less than projected, and similarly when
cloud cover or unexpected weather limits the output of solar panels.
Because wind and solar are intermittent, these resources would not eliminate the need for quick-start and fast-ramping dispatchable resources such as a CT unit like the New Orleans Power Station. In addition, because they are intermittent, Entergy New
Orleans cannot count a megawatt of renewable-resource capacity toward meeting a megawatt of customers’ long-term capacity
needs. Thus, even if intermittent resources could meet the company’s supply role needs by providing peaking and reserve capacity – which they cannot – Entergy New Orleans would have to acquire significantly more capacity than need dictates given
the low capacity factor assigned to renewables by the Midcontinent Independent System Operator, Inc.
Intermittent resources like renewables could have a place in Entergy New Orleans’ supply portfolio. To the extent that those resources can provide cost-effective energy sources, they will benefit customers. In fact, Entergy New Orleans recently issued a
request for proposals to determine whether there are cost-effective renewable resources available, and construction of its pilot
solar project that integrates state-of-the-art battery-storage technology will be put into service this year.
What about public input?
As part of the IRP process, of which the proposed CT unit is a part, Entergy New Orleans hosted four primary and three interim
public meetings as part of an ongoing commitment to seek broad stakeholder input and provide transparency in the development of the IRP. Moreover, Entergy New Orleans has made a filing with the council and has asked for a procedural schedule to
be established to determine whether the New Orleans Power Station is in the public interest.
Have project questions?
[email protected]
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