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800-MW Ohio gas plant aims to begin construction in October

August 19, 2014

The nearly 800-MW Oregon Clean Energy Center, one of three planned natural gas-fired power plants in Ohio designed to at least partially offset the loss of generation from coal plant retirements, is expected to enter construction in October, an executive with the developer said this week.

Oregon Clean Energy, which is due online in May 2017, is likely to be the first of the three projects to enter construction. The other two projects are the 742-MW Carroll County Energy being developed by Boston-based Advanced Power North America, a subsidiary of privately owned Advanced Power of Switzerland, and a 540-MW gas project in Butler County being developed by NTE Ohio of St. Augustine, Florida.

"All systems are a go at this point," said William Martin, whose Boston-based North America Project Development is building the $800 million Oregon combined-cycle project near Toledo in northwest Ohio.

Martin said he plans to enter into two or three long-term power purchase agreements for Oregon Clean Energy's total output as the project nears financial close this fall. "We want to prepare the site to receive equipment in the spring" when on-site work will begin in earnest, he said.

A North Coast Gas Transmission pipeline is expected to supply the plant with natural gas.

The Ohio Power Siting Board on May 1, 2013, approved the 799-MW gas project, saying Oregon Clean Energy "will add much-needed generating capacity to northern Ohio." Martin said he is already considering adding even more generation at the site. "Generally, we're contemplating ways of expanding it," he said, declining to elaborate.

Ohio is stepping up its development of shale gas from the Marcellus and Utica formations that is expected to help fuel new electric generation in the coming years.

FirstEnergy and American Electric Power, the state's two largest electric utilities, either have retired or plan to shutter several thousand megawatts of coal capacity in Ohio. Columbus-based AEP alone intends to idle more than 2,000 MW of coal plants over the next year or so. However, the companies are not turning away from coal altogether.

FirstEnergy recently sought Ohio Public Utilities Commission approval, and AEP Ohio is expected to do so shortly, for a PPA rider that essentially would charge customers for the guaranteed continued operation of several coal plants. In the case of FirstEnergy, it also would include the 908-MW Davis-Besse nuclear plant.

Martin said the proposed PPA riders "aren't impacting us directly," although the commission's ultimate decision "will affect the general [power] market." If anything, "we've seen more interest" in Oregon Clean Energy as discussion about the PPAs heats up, he said.

Nearly a decade ago, Martin co-developed the 700-MW Fremont Energy gas plant in Ohio with Calpine. In 2008, Fremont was sold to FirstEnergy. In 2011, American Municipal Power acquired the plant. It began commercial operation in February 2012.

After forming CME North America Merchant Energy in 1992, the predecessor of North America Project Development, Martin was the lead developer of the first independent power project in North Africa, partnering with Caterpillar Corp. In 2011 Martin and William Siderewicz co-founded North America Project Development to develop combined-cycle gas plants, primarily in the Northeastern US.