Tennessee Valley Authority decided Thursday it will shut down the Paradise and Bull Run plants.

But the closure will only reduce TVA's coal use by 1 percent.

The Paradise closure was opposed by Republican politicians, including President Trump.

The Paradise and Bull Run coal-fired power plants will close, Tennessee Valley Authority board members decided Thursday, despite some public protest and political opposition over the Paradise plant.

The intent is to close the final Paradise unit by the end of 2020, and the Bull Run plant by the end of 2023, agency CFO John Thomas said.

“Analysis over the past several months shows that closing two additional fossil plants is the right action to take at this time, financially and operationally,” outgoing TVA President and CEO Bill Johnson told board members. “It is not about coal. This decision is about economics.”

The half-century-old coal plants were designed to operate at full capacity about 80 percent of the time, he said. They can’t be speedily started, or easily provide varying levels of power.

“To get these plants to run on Thursday, you have to start them on Tuesday,” Johnson said.

The changing nature of power demand, and of TVA’s generation system, means the two coal plants can only run about 10 percent of the time, and that’s just not cost-effective, he said.

The power provider is able to meet its base demand more economically without them, Johnson said.

“We can avoid over $1 billion of lifetime cost on these units,” he said.

But the retirements will only drop coal’s contribution to TVA’s generation system by about 1 percent, meaning the share of power coming from coal will remain at today’s 17 percent for the next decade, Johnson said.

TVA closed five coal plants from 1966 to 2016, including three since 2012. It still operates six; the loss of Paradise and Bull Run will drop that to four.

Yet TVA will spend $2.3 billion on the rest of its coal fleet over the next five years; the two plant closures won’t really change what the agency spends on coal, Thomas said.

Johnson said he expects TVA to keep using coal until at least 2050; no further plant closures are currently under discussion.

Quarrel over Paradise

The Paradise Fossil Plant in Muhlenberg County, Kentucky, began with two coal-burning units in 1963, adding a third in 1970. The two older units shut down in 2017, and the same year TVA opened a $1 billion natural gas plant on the site. The gas plant employs 30 to 35 people, according to TVA spokesman Scott Brooks.

On Monday, President Donald Trump tweeted that TVA should “give serious consideration to all factors before voting to close viable power plants, like Paradise #3 in Kentucky!” In an unusual step, TVA’s marketing team responded: “Mr. President, coal is an important part of TVA’s power generation mix and we will give serious consideration to all factors as we make this decision.”

Related:TVA board faces Trump ire on Paradise coal closure

U.S. Rep James Comer, who represents the area; Kentucky Sens. Mitch McConnell and Rand Paul; and Kentucky Gov. Matt Bevin all decried the proposal to close the Paradise plant, citing roughly 130 jobs which would be directly affected. All four men, like Trump, are Republicans.

Board member Kenny Allen, a career coal company executive who lives less than 30 miles from the Paradise plant, sought to postpone the decision until the board’s May meeting. But his motion failed, and the Paradise closure was approved 5-2, with Allen and A.D. Frazier voting against it.

Asked after Thursday’s meeting if anyone from the Trump administration contacted TVA officials apart from the president’s tweet, Johnson said he and other agency representatives had discussed the plant closures with state and federal elected officials — “every major individual affected by it” — before the public announcement.

The coal burned at Paradise comes from Ohio-based Murray Energy Corp., Johnson said. That company is headed by Robert Murray, a major Trump backer; he and his company have contributed more than $1 million to groups supporting Trump in the 2016 election.

Oak Ridge reaction

Closure of the Bull Run plant near Oak Ridge passed unanimously. Several environmental groups immediately issued statements praising the decision to close the two coal plants.

The Bull Run plant opened in 1967. It employs about 100, Johnson said. Its proposed closure did not provoke the same widespread outcry, but Thursday afternoon the city of Oak Ridge released a statement on the issue.

TVA briefed city officials late Monday, before the regular city council meeting, but didn’t tell them the agency’s final environmental assessment and finding of no significant impact had been issued the same day, according to the statement.

“We will need to make sure that TVA follows through and works with our communities on environmental and socioeconomic impacts related to the closure,” it said.

There is long-term potential for hazardous waste discharge from buildings on the Bull Run site, including into waterways, which will require monitoring, the environmental study found. If the plant closes, a new coal ash landfill won’t be built unless the state orders it, according to the impact statement.

Johnson thought, but wasn’t sure, that Bull Run’s coal comes from the Powder River Basin in Montana and Wyoming. TVA heard lots of opposition from plant workers and coal miners, but not from coal companies, he said.

“I did not hear directly or indirectly from any coal suppliers about this decision,” Johnson said.

About 40 percent of the workers at the plants are eligible to retire, and TVA will try to help the rest, he said. In past plant closures, almost all those affected were able to move to jobs elsewhere in the TVA system, Johnson said.

He speculated on possible futures for the sites: redeveloped for another use, test beds for coal-ash research, perhaps even sold to another power company and thus remaining in operation.

If the plants do actually close, there will be dismantling work for years, Johnson said.

Coal ash fallout

Board member Ron Walter asked Johnson for comment on the News Sentinel’s Feb. 5 story that TVA acknowledged possible financial liability in workers’ lawsuit against Jacobs Engineering, resulting from that firm’s cleanup of the 2008 coal ash spill at the TVA Kingston Fossil Plant site.

According to evidence in the case, cleanup workers were told coal ash was safe, although it contains more than two dozen toxic chemicals. Jacobs refused to provide them with safety equipment, then tampered with tests to show low exposure. Workers complained of symptoms to TVA supervisors as early as 2013, but those complaints were ignored.

More than 900 workers were exposed to coal ash, of whom more than 40 — including at least two TVA employees — are now dead, and more than 400 are sick. The lawsuit involves fewer than 75 of those workers. The case’s outcome will determine whether hundreds more can seek damages.

Johnson said Thursday that Jacobs Engineering wouldn’t work without an indemnity clause in its contract.

“Under that clause, TVA might be responsible to pay some of the costs that Jacobs might incur as a result of the trials,” he said. “That decision won’t be made for years to come.”

A jury verdict last fall said Jacobs breached its contract with TVA, breached its duty to ensure worker safety, and “might have caused conditions that led to illness and injury of the employees,” Johnson said. But the company hasn’t formally been found liable for resulting illnesses and deaths; those trial decisions are still to come, he said.

“At that point we will talk about the indemnity clause, whether TVA pays any of this or not,” Johnson said. “I cannot see a situation where this will affect anybody’s rates in the Valley.”

Without naming the News Sentinel or reporter Jamie Satterfield, Johnson sought to downplay the report, saying the newspaper printed the indemnity provision in August 2017 — apparently as part of a legal notice — while TVA has twice included its potential liability in filings with the Securities and Exchange Commission.

New flight rules

The board unanimously approved tighter regulation of TVA aircraft use, in the wake of two reports last year from the agency’s own inspector general which found TVA broke federal rules and its own policies.

Board Chairman Richard Howorth said the changes clarify who’s authorized to use the agency’s aircraft, how use is documented, and the allowable reasons for use. The new policy passed without further discussion.

TVA management disagreed with the Oct. 30 report on helicopter use by Assistant Inspector General David Wheeler, but said at the time they would address most of the report’s recommendations.

The agency has eight helicopters, including a recently-arrived $3.9 million replacement for one which crashed in 2016.

TVA drew widespread criticism last year when it bought two Cessna Citation Excel jets and a 2013 Airbus luxury helicopter for $28.85 million. All three were used; they cost $40 million new.

Four-fifths of the helicopter flights between Oct. 1, 2014, and Dec. 31, 2017 were for routine work or training, but the rest — more than 450 — were described as passenger trips or “economic development” flights. The choppers cost an average of $1,450 an hour to fly.

Good records of who was on those flights weren’t always kept. Auditors found TVA didn’t document cost comparisons before choosing helicopters over other transport; didn’t document business justifications for flights; and didn’t document executive authorization for helicopter use.

Earlier findings on airplane use were similar.

Auditors recommended TVA require detailed documentation of flights, specific authorization, cost comparisons and justification.

TVA replaced its flight scheduling software to improve documentation and began requiring cost analyses.

The policy approved Thursday formalized those and related changes, bringing it in line with federal travel guidelines, according to TVA spokesman Jim Hopson.