by: Doyle Beneby, CPS Energy CEO
CPS Energy officially acquired the 800-megawatt (MW), 10-year-old Rio Nogales gas plant, making it part of our generation fleet on April 10. I would like to thank the transition team, Tenaska Capital, and City of Seguin officials for their hard work to make this purchase a smooth process.
CPS Energy Acquiring Rio Nogales accomplishes several goals. First and foremost, it saves ratepayers the ongoing expense (expected to top $1 billion) of trying to meet impending and anticipated future environmental regulations for our oldest coal plant, J.T. Deely, as the generation from Rio Nogales will ultimately replace that of the 871 MW plant. Along with supporting our strategy of diversification and risk management, adding Rio Nogales to our fleet supports the South Texas economy as gas is available in abundance at this time and for the foreseeable future. Switching from coal to gas also places us in a more advantageous position as the current drought conditions continue because gas plants use less water. Even with Deely and other CPS Energy plants relying heavily on recycled water, we’re glad to transition to more drought-favorable generation. With Rio Nogales, we also have acquired a plant with safety principles aligned with ours. The facility has an excellent safety record. We’re happy to have 27 employees there join the CPS Energy team, which achieved the best safety performance in our utility history. And, finally, but not least – we are keeping our commitment to the community to take Deely offline in 2018.
Shuttering the aging plant will help further improve San Antonio’s air quality. Rio Nogales provides a low-emitting, cleaner energy resource that emits virtually no sulfur dioxide, particulate matter or mercury. Generating reliable, affordable energy—without sacrificing air quality or the availability of water—is good for businesses in our community. We are committed to serving our customers today, and to adding new customers to our thriving city.
Clean energy, economic development, jobs and educational investment are the foundation of our New Energy Economy initiative. We have brokered partnerships with seven companies that are resulting in more than 1,000 current and future jobs and millions of dollars in educational investments. Recently, UTSA and Alamo Colleges received a combined $300,000 for scholarships from one of New Energy Economy partners, SunEdison. As we pursue other potential partners to secure energy storage solutions and additional smart grid technologies, we will be sure to keep the community posted. In the meantime, please know that CPS Energy is working for you.