Healy Unit 2 Power Plant

Current Status

On December 4, 2013, the purchase of Healy Unit 2 was finalized. Golden Valley paid $44 million to the Alaska Industrial Development and Export Authority (AIDEA) for the power plant. The purchase of the power plant is being financed by the Cooperative Finance Corporation (CFC).

Before we can restart Healy Unit 2, certain systems must be upgraded. These upgrades (AKA restart activities), include installing new mill exhauster fans and environmental analyzers, as well as upgrading the pulverizer, electrical and coal handling systems. The cost of these activities, as well as the installation of advanced pollution control systems, will be financed by the Rural Utilities Service.

Healy Unit 2 is expected to resume operation by the end of 2016, after experiencing a fire/explosion on March 3, 2016. That event caused significant damage to the plant's coal feed system.

The Selective Catalytic Reduction (SCR) environmental equipment has been installed on Healy Unit 2 and is expected to be commissioned in September 2016, nearly a year ahead of schedule. Additionally, on Healy Unit 1, the Selective Non-Catalytic Reduction (SNCR) environmental equipment was installed and commissioned in August 2016, nearly a year ahead of schedule.

This 50 MW power plant increases our baseload of coal-fired generation and will provide long-term stability since coal prices over time have proven to be significantly less volatile than oil or gas prices.

Restart Progress Overview

August 4, 2015 - First-fire with coal, which began a two-month testing phase. The plant will be brought up and down, from 5 to 50 megawatts, in order to test equipment and systems. Full commercial operation is expected to begin later this fall. Work will continue at the plant for the next two years. The new environmental controls will be housed in a new addition to the plant, which is approximately 55 percent compete and scheduled to be finished in the summer of 2017. Read more about Healy 2 restart project on GVEA's blog http://blog.gvea.com/wordpress/?p=2364

June 12, 2015 - Breaker was closed, and Unit 2 produced 5 megawatts of power. Then slowly moved to 15MW of power (the maximum electricity that can be produced with oil as the fuel source). Unit 2 will continue to run off and on throughout the two-month testing phase.

June 8, 2015 - Fuji (the manufacturer of the turbine) representatives and a trainer from Japan arrived in Healy. They oversaw testing and conducted training. The turbine was rolled on June 11.

May 28, 2015 - Unit 2 was fired on oil for the first time since 1999, which began a two-month test phase. Steam was produced, but the turbine was not rolled.

May 2014 - Restart work began and will continue into 2015.This work includes new mill exhauster fans and environmental analyzers, as well as control system, pulverizer and electrical upgrades.

Permitting Hurtle Cleared

In November 2012, the joint Consent Decree between GVEA, AIDEA and the Environmental Protection Agency (EPA) was approved.

At issue was the agency’s reissue of the air permit – the last major hurdle to restarting the Healy Unit 2 Power Plant.

Golden Valley chose to pursue the Consent Decree option with the EPA, otherwise, there was no defined end to the air permitting process. The Consent Decree avoids what the co-op believes would have been lengthy and costly litigation.

Consent Decree Stipulations

  • GVEA agreed to install the most rigorous emission controls available on Healy Unit 2, with an estimated cost of $88 to $92 million. This includes an estimated $5 million for installing additional nitrous oxide controls on Healy Unit 1.

  • GVEA agreed to pay $250,000 to help fund the Fairbanks North Star Borough and Denali Borough Woodstove Change-out Program. This will help alleviate the particulate matter problems in the Interior.

  • GVEA negotiated for a minimal payment of $115,000 to the EPA. Payments to the EPA are required under the rules of a Consent Decree.

The Consent Decree does not require any mandatory shutdown dates for neither Healy Unit 1 nor Healy Unit 2. GVEA’s board of directors retains full control of decisions regarding shutdown of either plant.  

Restarting Healy Unit 2 will:

  • Further diversify our fuel mix, which will help stabilize rates
  • Put this $300 million State and Federal asset to work

History of the Plant

In 1989, the U.S. DOE’s Clean Coal Technology Program selected Healy as a demonstration plant to use experimental technology to burn waste coal. Healy Unit 2 began burning coal in 1998 and generated power intermittently through 1999 in its testing phase. When the plant failed a 90-day commercial operation test, it was placed in warm lay-up status in early 2000. Talks between AIDEA and GVEA to resolve disputes were unsuccessful. In 2005, AIDEA filed a lawsuit against GVEA. The purchase of the power plant ended the lawsuit.

1993 Final Environmental Impact Statement
(Volume 1 | Volume 2)

Construction funding

Department Of Energy

$120 million

Alaska Legislature

$25 million

AIDEA

$150 million

GVEA & Usibelli Coal Mine

$10 million plus in-kind contributions

 

Timeline

1989

DOE selected Healy Unit 2 (formerly HCCP) as a Clean Coal Technology Program demonstration plant.

1995-1997

Healy Unit 2 constructed.

2000

Plant placed in warm lay-up status.

Feb. 2009

GVEA and AIDEA reach sale agreement.

2009 - 2013

Negotiations were finalized in December 2013 when the purchase agreement was signed on December 4.

2014

Necessary system upgrades were made to the power plant.

2015

Healy Unit 2 was successfully fired on oil on May 28. On August 4, the plant was fired on coal. This began the test phase.

2016

On March 2, Healy Unit 2 passed its commissioning test. The plant met availability, environmental and economic metrics.

Per the Consent Decree stipulations, the additional required environmental equipment has been installed. On Healy Unit 2, the Selective Catalytic Reduction (SCR) equipment will be commissioned in September. On Healy Unit 1, the Selective Non-Catalytic Reduction (SNCR) equipment was commissioned in August. Both installations are nearly a year ahead of schedule.

 

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