Conservation groups sue over federal utility's plan to replace coal plant with gas

NASHVILLE, Tenn. — Conservation groups have filed a lawsuit seeking to stop the nation's largest public utility from replacing a Tennessee coal-burning power plant with one using natural gas.

In a federal lawsuit filed this week, Appalachian Voices, the Center for Biological Diversity and the Sierra Club challenge a decision earlier this year by the Tennessee Valley Authority to build a natural gas facility at the site of the aging Cumberland Fossil Plant in Tennessee. The lawsuit contends that the power provider didn’t properly consider cleaner energy options or correctly factor in climate and economic impacts.

The federal utility moved forward with the plan despite concerns raised by the U.S. Environmental Protection Agency that the utility’s analysis of alternatives was faulty and that the project is at odds with President Joe Biden’s clean energy goals.

Biden has called for a carbon-pollution-free energy sector by 2035. That’s a goal TVA has said it can’t achieve without technological breakthroughs in nuclear generation and energy storage. The federal authority has a goal of 80% reduction in carbon emissions by 2035 over 2005 levels and net-zero emissions by 2050.

The lawsuit claims TVA violated a requirement of federal agencies under the National Environmental Policy Act to give serious consideration to other alternatives. The challenge also argues that TVA did not afterward sufficiently consider the failures at certain coal and gas plants that led to rolling blackouts at Christmas time last year. Additionally, the lawsuit says the public utility didn't appropriately account for renewable energy incentives in the Inflation Reduction Act.

“Instead of studying the environmental and financial impacts of its decision, the Tennessee Valley Authority relied on flawed reasoning and faulty assumptions to downplay the effects of its planned gas plant,” said Amanda Garcia, director of the Tennessee office of the Southern Environmental Law Center, which filed the lawsuit for the conservation groups.

On Thursday, Tennessee Valley Authority spokesperson Scott Brooks said the utility followed the environmental law in question.

“TVA takes our environmental compliance obligations seriously, and the Cumberland Fossil Plant Retirement Environmental Impact Statement fully complied with all NEPA requirements,” Brooks said.

TVA plans to retire the first of two coal burning units at the Cumberland plant by the end of 2026 and expects to have the 1,450-megawatt gas plant up and running before then. TVA also plans to retire Cumberland’s second coal-burning unit by the end of 2028. It has proposed a plan to replace part of that lost production with a 900-megawatt gas plant in Cheatham County, Tennessee, along with a 400-megawatt battery storage system.

TVA has said the new gas plants will provide the flexibility needed to add 10,000 megawatts of solar to its overall system by 2035 and still meet peak demand periods.

For the Cumberland plant, the utility's review process compared the costs and benefits of two types of natural gas plants as well as a solar array with battery storage. It determined that the solar array would cost $1.8 billion more and could not be completed by the utility’s 2026 deadline.

The groups that sued contend that TVA overestimated the amount of solar and battery storage needed, dramatically driving up the cost estimate, and failed to factor in costs for the gas plan, such as the planned future use of carbon capture and hydrogen blending at the facility.

They also pointed out that the TVA signed contracts with two gas companies months before it completed the environmental impact study that was supposed to guide its decision.

The utility corporation said the contracts were necessary to allow preliminary planning work. They were not binding agreements to choose gas, Brooks the TVA spokesperson has said. They were contingent on TVA’s final fuel decision.

A gas pipeline application remains pending with the Federal Energy Regulatory Commission.

TVA's energy mix — topping out at about 38,000 megawatts — includes 43% nuclear, 26% natural gas, 13% coal, 14% hydroelectric and 4% of other types of renewables, such as solar, according to a May filing with the Securities Exchange Commission.

A similar lawsuit seeks to block a gas-burning TVA plant at the retired coal-burning Johnsonville Fossil Plant, claiming the utility violated federal law last year by failing to properly assess the environmental and climate impacts. TVA has declined to comment on the case.

Last month, TVA announced plans to build a new natural gas plant to replace its coal-burning Kingston Fossil Plant — the site of a massive coal ash spill in 2008 — one day after the Biden administration proposed strict new limits on greenhouse gas emissions from power plants.