News

Extension eyed for Sandow 5

Problems force Luminant to delay at least 59 days
By MIKE BROWN Reporter Editor

Luminant's 581-megawatt Sandow 5 won't be on-line with the state's electrical grid by its long-time goal of Aug. 31.

On Monday the power generating company filed a document before the Securities & Exchange Commission (SEC), stating it is seeking a 59-day extension of the Aug. 31 deadline.

That request is now before the other parties in a 2003 litigation settlement in which Alcoa agreed to construction of a newer, cleaner power-generating facility to replace the half-century-old Sandow Power Plant Units 1, 2 and 3.

Those other parties are the U. S. Department of Justice and environmental groups Environmental Defense, Public Citizen and Neighbors for Neighbors.

'Malfunctions'

In its brief, Luminant cited weather related construction delays, including Hurricane Ike last fall, and some "equipment malfunctions" during initial testing this summer as reasons for seeking the delay.

"Under the consent decree, Sandow 5 was to be compliant in two areas by Aug. 31," Lisa Singleton, Luminant spokesperson, said. "One was to be ready for commercial operation. And we are ready. In testing we have already been synchronized to the (statewide power) grid."

It's the other requirement, meeting court-imposed emission requirements, which is causing the delay, according to Singleton.

She said there were "unexpected malfunctions" during equipment testing, including one test on July 4.

Luminant estimates Unit 4's operation will be delayed two to three months.

"The project's cost remains on budget," Monday's filing stated.

Bechtel, Alcoa

Andy Broussard, project manager for Bechtel/Becon, which constructed Unit 5 for Luminant, declined to comment on this week's developments.

And Alcoa is adopting a wait-and-see attitude, according to spokesman Jim Hodson. While the original consent decree involved Alcoa, Luminant became a party to the consent decree when it acquired development rights to Sandow 5.

Alcoa shut down its Rockdale smelter last year.

"This (missing the deadline) really doesn't have anything to do with Alcoa," Hodson said. "The only thing Alcoa is responsible for, jointly with Luminant, is any penalties that might be involved."

Alcoa-Luminant dispute?

Neig hb or s for Neig hb or s (NFN) spokesman Travis Brown isn't buying the weather partial explanation for the delay.

He said Tuesday blaming Hurricane Ike was "ridiculous" and noted the hurricane's damaging winds and rain did not come near Rockdale.

Brown said NFN attorneys are requesting additional information from Luminant on why Sandow 5 "will not meet the pollution emission rates the court order requires."

Brown theorized the delay may be related to the ongoing legal dispute between Alcoa and Luminant and what he termed "the poor quality of coal being mined by Luminant at the Three Oaks Mine."

NFN opposed the creation of both Three Oaks and Sandow Power Plant Unit 5.

Extension

It's likely the matter will end up back before Judge Sparks, the jurist who set the original deadline.

"The judge could grant an extension of the deadline," Singleton said. "There is language in the consent decree which allows for us to seek an extension and certainly allows him to grant one."

Texas energy consumers also have a stake in the delay.

The Electric Reliability Council of Texas (ERCOT), the state's primary grid operator, was counting on Sandow 5 to partially offset the loss of more than 2,000 megawatts of older natural gasf ired units which Luminant retired ahead of the summer season.

Normally ERCOT 's record month for power demand is August.

SANDOW 5 SAGA ... SO FAR

• Summer 2002 —Three environmental groups sue Alcoa over pollution concerns at 50-year-old Sandow Units 1, 2 and 3.

• April 2003—A settlement is reached in which Alcoa has until September, 2004, to decide whether to upgrade or close the units.

• September 2004—Alcoa decides to close Units 1, 2 and 3 and

nd an outside entity to construct a new power plant unit at Sandow.

• November 2005—After an initial venture with Constellation Energy falls through, Alcoa announces it will contract with TXU to construct the new unit.

• Spring 2006—With a court-mandated completion date of April 25, 2007, looming, construction starts on Unit 5 even through the transfer of a key air-quality permit from Alcoa to TXU is still pending before Federal District Judge Sam Sparks.

• December 31, 2006—Units 1, 2 and 3 close permanently.

• Feb. 29, 2007—Sparks okays the permit transfer, imposes a fine on Alcoa, which will obviously miss the April 25 deadline, and orders the new power plant to be on-line by Aug. 31, 2009.

• July 20, 2009—Luminant (which TXU morphed into in 2007) asks the Securities & Exchange Commission for an additional 59 days to meet court-mandated environmental requirements at Unit 5.


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The burn ban for Milam County has been lifted. Burning is always prohibited in the county's municipalities.


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