Regents approve roughly $17 million Louisiana Tech project to decommission aging cogeneration plant

The Board of Regents approved a third‑party infrastructure project at Louisiana Tech aimed at decommissioning an aging natural‑gas cogeneration power plant, replacing mechanical and electrical systems, and connecting the campus to local utility services.

Facilities staff said the plant has operated since the 1940s and that distribution systems are at capacity; the proposed scope includes decommissioning the plant, replacing boilers and chillers and upgrading mechanical/electrical distribution to permit a 2027 connection to local utility providers. Staff estimated the total project cost at approximately $17,000,000, with a maintenance reserve funded at $50,000 per year.

Presenters said the project uses a third‑party model: an external entity would construct and manage the improvements under lease terms; upon completion and satisfaction of debt service the assets would revert to the institution. Staff told the board annual operating savings from decommissioning — cited as roughly $1,600,000 per year in avoided operating costs — would be sufficient to cover annual debt service and projected a net debt‑service surplus in the first years of operation (presenter noted about $300,000 per year in excess of debt service in the pro forma provided to the system and bond counsel).

Regents asked whether the proposal had independent financial review and requested due diligence; staff said the figures were developed with counsel and bank partners and that bond counsel and lenders were present to answer technical questions. Regent May moved to approve the project, a second was recorded, discussion concluded and the board approved the project.