The LCRA Board of Directors today authorized staff to replace the Thomas C. Ferguson Power Plant near Marble Falls with a new natural gas-fired power plant that will be one of the most efficient, reliable and environmentally responsible electric generating facilities operating in Texas.

The project involves building an approximately 540-megawatt (MW), combined-cycle electric generation facility to replace the aging 420-MW Ferguson Power Plant, which was built in 1974. The decision follows a year-long evaluation by LCRA staff of the costs and benefits of the project. The evaluation included soliciting bids from potential contractors, gathering input from LCRA's wholesale electric customers, and hosting several open houses to inform neighboring communities about the proposed project.

"It makes good business sense to replace the Ferguson plant with a newer, more efficient generating unit that will provide LCRA's customers with more competitively priced power," said LCRA Board Chair Timothy Timmerman. "This investment will continue LCRA's tradition of providing reliable, cost-based electricity to cities and cooperatives throughout Central Texas."

"Combined-cycle power generation is a very cost-effective, clean and safe way to produce electricity," said State Sen. Troy Fraser R-Horseshoe Bay. "This project is good for the people of Texas, particularly in the rural Hill Country region, an area with limited electric generation resources. A newer, more efficient power plant at this location will strengthen LCRA's ability to maintain reliable electric service in the Texas Hill Country."

Replacing Ferguson will help LCRA better manage wholesale power costs over the long term because a combined-cycle power plant uses about 35 to 40 percent less fuel than a traditional gas-fired plant like Ferguson to produce the same amount of power. A combined-cycle power plant combines a gas turbine system and a steam cycle system to generate electricity. The combination of the cycles creates a highly efficient power plant with lower fuel costs and fewer emissions per unit of power produced.

"The new power plant will be a valuable addition to the diverse mix of resources LCRA depends on to provide our customers with reliable, affordable and environmentally responsible power," said Tom Mason, LCRA general manager.

LCRA staff now will begin a competitive negotiations process with Fluor Enterprises of Irvine, Calif., and SNC-Lavalin Thermal Power of Bothell, Wash. The two vendors submitted proposals for the engineering, procurement and construction of the plant. LCRA plans to select the contractor by August 2011. Then, LCRA will work with the contractor to develop a project schedule, which will include a two-year construction phase to bring the new power plant on-line in 2014. LCRA will build the new unit at the Ferguson site on Lake LBJ. The existing power plant will be retired following completion of the new facility.

"LCRA has been a good neighbor since it built Ferguson in the 1970s and I am confident that our good relationship will continue throughout construction of the new power plant," said Bob Lambert, mayor of Horseshoe Bay and former chair of the LCRA Board of Directors.

LCRA and the contractor will coordinate closely with local law enforcement, city and county leaders, and other public safety officials to minimize impacts to neighbors during construction. Potential contractors received information about the community's preferences and concerns expressed during community meetings earlier this year. The selected contractor will be asked to work within the noise levels and work hours defined in local ordinances. After the contractor is selected, local providers of goods and services will be invited to an open house with the selected contractor to learn more about local business opportunities.

"We welcome the economic benefit that a major construction project like this will bring to the neighboring communities," said Llano County Judge Wayne Brascom.

"After LCRA has selected a contractor and developed a project schedule, we will host open houses to inform area residents about our plans," said Mason. "There will be open and regular communications throughout this project."

For more information about the project and to subscribe for regular e-newsletter updates, visit the project web page at www.lcra.org/energy/power/facilities/fergusonstudy.html.