Sunday, October 22, 2006

Alcoa in Texas

HOUSTON, Oct 19 (Reuters) -
A federal judge has denied TXU Corp.'s (TXU.N: Quote, Profile, Research) request for more time to build a proposed coal-fired power plant to replace an older, dirtier plant near an aluminum smelter in central Texas.
U.S. District Judge Sam Sparks denied a request from Dallas-based TXU and aluminum maker Alcoa Inc. (AA.N: Quote, Profile, Research) that would have allowed TXU to pay a fine in order to take more time to complete construction of the 600-megawatt plant, according to court papers.

TXU has said it cannot complete the plant by a 2007 deadline set by Alcoa. The plant was to be the first of nine coal-fired plants TXU has proposed to build in the state.
Alcoa, in the settlement of a lawsuit by environmental groups, agreed to shut aging coal-fired units at its Rockdale, Texas, smelter, and to build a new power plant by 2007.

Under TXU's plan announced earlier this year, the Sandow 5 plant was scheduled to be the first of nine new coal plants TXU will build in Texas to help meet growing demand for electricity. TXU said Sandow 5 would begin construction this year and begin operating in March 2009, not 2007.

TXU has selected construction and engineering company Bechtel to design and build the unit in Milam County.

Environmental groups have opposed delaying the new power plant beyond the 2007 deadilne that Alcoa agreed to in a consent decree to settle the lawsuit.

The groups, which include Environmental Defense and Public Citizen, now want to force TXU to seek a new permit for the plant that would include more stringent emissiosn standards than currently required.

"TXU wants to build a new power plant, but it doesn't want to get the necessary permits or meet modern standards," said Jim Marston, regional director of Environmental Defense.


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