Duke Energy Plans $1 Billion Swap from Coal to Gas at Asheville

---

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Duke Energy (NYSE:DUK) (Charlotte, North Carolina) is hoping to clean up its energy mix with plans to shut its coal-fired Asheville plant and replace it with a larger, gas-fired plant that features solar generation.

The company's announcement comes just weeks after it was fined $102 million when Asheville, along with three other Duke Energy-owned coal-fired plants, were found guilty of negligently discharging coal ash and coal ash wastewater.

Duke Energy said it will shut Asheville in "four to five years" as part of a $1.1 billion investment to modernize its generation and transmission system in western North Carolina and upstate South Carolina. The company aims to replace the 376-megawatt (MW) plant with a 650-MW, natural gas-fired power plant that will feature additional solar generation. It is expected to cost approximately $750 million.

A further $320 million will be used to build a transmission substation near Campobello, South Carolina, and connect it to the Asheville power plant with a new 40-mile, 230-kilovolt (kV) transmission line. That money also will allow for the upgrading and rebuilding of additional electrical infrastructure, such as transmission lines and distribution substations.

"We've developed an innovative plan that's a 'win-win-win' for consumers, the environment and the economy," said Lloyd Yates, Duke Energy executive vice president of market solutions and president of the Carolinas region. "With the availability and near record low cost of natural gas, this comprehensive project will transform the energy system in the region to meet the growing needs of our customers and significantly reduce emissions and water use. We're eager to move ahead quickly on these projects and complete the key components of the plan by the end of 2019."

The company maintained that at current natural gas prices, the gas plant would be about 35% less expensive to operate than the existing coal plant.

Duke Energy explained that the electricity demand in the Asheville service area has doubled over the last four decades, forcing the need to import about 400 MW during peak demand periods. The new plant will be designed to supply much of the extra power needed and help address a forecast that the region's power demand will grow 15% in the coming decade.

More importantly for Duke, which has come under fire on environmental issues, a gas-fired plant will see carbon dioxide (CO2) emissions drop about 60%, sulphur dioxide 90-95%, nitrogen oxide approximately 35% and the complete elimination of mercury, according to company figures.

The new plan for Asheville will cancel Duke's existing plan to invest in 126 MW of oil-fired generation units to meet peak demand, and other capital investments that were planned for 2019, the company said.

Yates concluded: "We look forward to working with regulators to provide this creative solution for our customers in the region. In the coming months, we'll provide area landowners with options for the new transmission line so we can find the best possible route, with minimal impact on the environment, cultural resources, homes and businesses. Community meetings and public input will be an important part of this process."

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. To contact an office in your area, visit the Industrial Info "Contact Us" page.