In the latest illustration of the potential of the Marcellus Shale to boost regional energy supply, two natural gas-fired power plants are being planned for the heart of northern Pennsylvania’s shale country.
If they go into operation as planned by early 2016, they would be the state’s first plants to be powered by gas from the Marcellus, the massive Appalachian formation that’s estimated to contain enough of the fuel to meet total US needs for 20 years or more, at current consumption rates.
The proposed construction of the plants, which would begin in mid-2013, bolsters claims by the natural gas industry and the administration of Pennsylvania’s Republican Governor, Tom Corbett, that the Marcellus is a “game changer” that is generating thousands of jobs and millions of dollars in tax revenue while boosting national energy security and cutting carbon emissions.
The two plants would be built in Bradford and Lycoming Counties, two of the most intensively developed areas of the Marcellus Shale, where energy companies have drilled hundreds of wells since the state’s shale-gas boom began in 2008.
Costing around $800 million apiece, the plants would each generate about 800MW, or enough to power about 1.5 million homes in total.
Strategic Location
The locations were chosen because of their proximity to fuel supply, to the large northeastern electricity markets, and to existing transmission infrastructure, said Kent Morton, vice president of Moxie Energy, the Virginia-based energy-development company that is planning the plants.
“We looked at where the electricity need was, and while we think there is going to be a lot of electric need in Ohio and West Virginia, it exists now where we are located,” Morton told Breaking Energy. “There is significant load on the East Coast.”
In addition, the transmission lines from northern Pennsylvania will be sufficient to serve the plants’ markets, Morton said. “We wanted to find a location that didn’t require significant upgrades,” he said.
In mid-October, Pennsylvania regulators approved an air-quality plan for the first plant, due to be built in Asylum Township, Bradford County, completing the plant’s permitting process, and clearing the way for construction to begin. Some permits are still needed for the second plant, in Clinton Township, Lycoming County, Morton said. Each plant is expected to create 500-600 jobs during construction and about 30 permanent positions when operational.
Officials from the state’s Department of Environmental Protection determined that the plants’ emissions would meet national ambient air-quality standards.
The plants “will benefit the environment and the economy by using a cleaner fuel and creating hundreds of jobs,” said DEP Secretary Michael Krancer, in a statement.
The facilities will run only on natural gas, and will cool condensers with air rather than water in recognition of local concerns about water quality and availability that have been heightened by the heavy demand for water used in the hydraulic fracturing of gas wells, and by accusations that the industry is contaminating ground water with toxic chemicals used in fracking.
The plants’ use of air rather than water cooling has hastened the regulatory process and will help nurture good community relations when the plants are built, Morton said. Mitsubishi or Siemens are potential suppliers of turbines, he added.
Morton said the company’s decision to locate the plants in Pennsylvania also reflected a regulatory regime that imposes environmental safeguards on the energy industry.
“They got out ahead of the curve in terms of regulation that would protect air and water resources,” Morton said.
While Moxie is the current owner of the planned plants, it’s possible they will be sold at some point, Morton said. He declined to specify expectations for gas prices that contributed to the plants’ financial projections, except to say that “they are going up.”
