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Council buys additional water to cool coal-fired Fayette Power Plant

Friday, December 9, 2011 by Michael Kanin

Because of Central Texas’ ongoing drought, Austin Energy needs more certainty that it will continue to have enough water to cool the coal-burning Fayette Power Plant. On Thursday, the City Council approved the purchase of additional “firm” water from the Lower Colorado River Authority. The agreement, for a relatively small portion of water, will augment what Austin Energy and the LCRA already use to cool the facility.

 

With Mayor Lee Leffingwell’s recent promise to move the City of Austin away from the use of coal-derived energy, the topic of whether the city could divert the water for other uses became suddenly relevant. According to LCRA spokesperson John Williams, Austin could redirect the water to its Sand Hill facility. Should it decide to move it elsewhere, however, the process could get a bit more complicated.

 

“This would be categorized as a ‘substantive amendment,’” Williams told In Fact Daily via email. “It would be subject to the most current LCRA contract requirements at that time. Such an amendment would require LCRA Board approval under LCRA’s current rules because the contract quantity is more than 500 acre-feet per year.”

 

The new agreement calls for an additional 3,500 to 7,500 acre feet of water per year. In 2010, the plant used nearly 19,220 acre feet. According to the deal, the city will pay $151 dollars for every acre foot that is actually used. It will pay half of that amount for any of the water that it reserves, but doesn’t use.

 

The deal will run for at least 10 years.

 

According to the request for Council action filed to bring the item before the dais, the city has enough water to cover its contribution to Fayette’s cooling needs during wet years. For drier periods, Austin Energy has had to buy water at the LCRA’s block rate to supplement that supply. The LCRA’s current block rate is $300 per acre foot.

 

Council Member Bill Spelman wanted to be sure that, if the city purchased the additional water via contract, it could use the water as it sees fit. “Could we, if we chose to suspend operation at Fayette between now and 10 years from now, at that point transfer our water rights…to…some place else where we could use them?” he asked.

 

Austin Energy staff confirmed that was the case.

 

Leffingwell took the opportunity to make sure that the Council’s commitment to the deal would “in no way…affect our potential divestiture of our share of Fayette.” Staff also said that was correct.

 

Spelman and Council Member Mike Martinez tried their best to use the occasion as an excuse to get a sneak peak at a study that Austin Energy staff are preparing about the issues and possibilities surrounding the Mayor’s call to end the city’s relationship with the Fayette plant. For the most part, staff didn’t bite. However, the utility’s Senior Vice President of Power Supply and Market Operations, Jackie Sargent, acknowledged that staff would include scenarios that explore a future without coal power.

 

The study is expected to be ready for Council review sometime next fall.

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