The Tennessee Valley Authority board of directors has approved plans to replace the Allen Fossil Plant in Memphis with a 1 000 MW combined-cycle gas plant.
The board authorised up to $975 million to build the Allen gas plant, which would become TVA's seventh new combined-cycle facility since 2007.
TVA says it is working to either retire or install emission controls at the three-unit Allen coal plant by December 2018 under a 2011 clean-air agreement with the U.S. Environmental Protection Agency, three states and four environmental groups.
"We evaluated our options from financial, business and environmental perspectives and decided this is the best way to help us meet our cleaner air goals and optimise the generation portfolio," TVA president and CEO Bill Johnson."
The gas plant will be built across the road from the existing 700 MW Allen coal plant. Memphis Light, Gas and Water will build the pipeline that will supply natural gas to the new plant.
TVA said that the decision to retire the 55-year-old plant follows an environmental impact assessment, which found "no significant impact" for construction of the facility.
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