Louisiana to ease nuclear, coal plant construction process

Louisiana to ease nuclear, coal plant construction process

New York (Platts)--2Jun2006

The Louisiana Public Service Commission wants to encourage greater power
plant fuel diversity in the state and on Friday launched a process that could
make it easier for utilities to build coal and nuclear plants.

In an order (Docket No. R-26172), the PSC confirmed its standing policy
that "Electric utilities...shall employ a market-based mechanism to support
the acquisition of generation capacity or purchase power contracts intended to
serve LPSC-jurisdictional retail customers." It also says that if a utility
wants to go down the self-build gas-fired plant route, that proposal would
have to compete against competitive options.

Staff attorney Ann Hill said the proposed order breaks new ground in
providing an exception for nuclear and "non-nuclear solid fuel" projects. This
stems from the need for fuel diversity in the state, an issue that has been
emphasized by Commissioner Jack Blossman, she said.

The proposed order says: "The use of a market-based mechanism shall not
be required for the construction of nuclear resources." It adds: "The
commission may deem certain projects involving non-nuclear solid fuel
resources to be in the public interest and grant those projects an exception
to the require use of a market-based mechanism."

To gain such an exemption, a utility would have justify the project and
explain to the PSC why it is in the public interest.

Hill said the commission will now take comments on the proposal, and
based on those, the staff will present a final proposal in July.

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