Bonaza decision: Impact on Sunflower Electric’s proposed coal plants?
November 17, 2008
Reprinted in full from Harris News:
Ruling’s effect on Sunflower plans unclear
By Chris Green
TOPEKA — Some opponents of a plan to build two coal-fired power plants in southwest Kansas said Friday that a new federal ruling could create a further hurdle for the stalled project.
Critics of the utility’s $3.6 billion expansion plans hailed a decision from an Environmental Protection Agency appeals board that blocked — for now — a federal permit for the Bonanza coal plant in Utah.
In making its ruling on Thursday, the appeals panel said the EPA’s Denver office must explain why it declined to limit carbon dioxide emissions in issuing a permit for the plant, which is on an Indian reservation.
State and national environmentalists said the move seems to signal that CO2 emissions of all new coal plant projects now will be considered when federal or state officials decide whether they should receive permits.
Stephanie Cole, a spokeswoman for Kansas Sierra Club, said the decision would put Sunflower’s plans for new coal plants on shakier footing.
“It’s our belief that this is just one more reason why Sunflower and its partners should not be moving forward with a multi-billion dollar project with increasing financial and regulatory uncertainty,” Cole said.
However, a spokeswoman for Sunflower Electric Power Corp. couldn’t say Friday whether the ruling would have have any effect on the utility’s Holcomb expansion project.
“We constantly evaluate the political and economic conditions that may affect our project,” Sunflower spokeswoman Cindy Hertel said. “Our environmental personnel have not had the opportunity to review the decision regarding the Utah coal plant as to whether or not it will impact us.”
Hertel said the Hays-based, nonprofit utility, made up of six rural electric cooperatives it provides power to, would continue to pursue the project as long as it remained in the best interest of Kansas rate payers.
A spokesman for Tri-State Generation and Transmission Association of Colorado, the largest partner in the expansion project, could not be reached for comment. Tri-State plans to purchase power from one of the $3.6 billion project’s two generators and is paying development fees to Sunflower.
Permits on hold
Sunflower’s construction plans have been on hold since last year, when Health and Environment Secretary Rod Bremby blocked air-quality permits for the project over concerns about the plants’ CO2 emissions.
Bremby said he couldn’t ignore mounting evidence that the plants would emit 11 million tons of CO2 each year that would contribute to global warming.
But Sunflower and its supporters argue that they followed all existing laws in pursuing the permits and that Bremby overstepped his bounds in blocking them. They point out that there are no existing state or federal limits on the greenhouse gas.
The utility and its partners are pursuing a legal challenge to overturn Bremby’s decision, which could wind up before the Kansas Supreme Court early next year.
Legislative supporters could also make another run at clearing the way for the plants when they reconvene in January, after being thwarted by Gov. Kathleen Sebelius’ vetoes this past spring.
A spokesman for the Kansas Department of Health and Environment declined to comment on the EPA appeals board ruling. KDHE spokesman Mike Heideman said the agency couldn’t comment because of Sunflower’s pending legal challenge of the agency’s permitting decision.
But Bruce Nilles, director of the Sierra Club’s national coal campaign, said he believes that Thursday’s EPA decision decreases the odds that Sunflower’s project will ever receive permits.
Not a blow?
State officials must follow the EPA’s rules in awarding permits, Nilles said. Under the new ruling, he said he doesn’t believe Sunflower could win permit approval until state officials have given the project’s potential CO2 emissions additional consideration.
He said he also believes that the board’s move paves the way for President-elect Barack Obama to immediately limit CO2 emissions through Clean Air Act — without any additional action from Congress.
“It has an immediate and nationwide impact and really lays the groundwork for even more action on global warming on day one of the Obama Administration,” Nilles said.
But an industry group that backs expanded use of coal power counters that environmentalists may be reading way too much into one decision.
Joe Lucas, a spokesman for the American Coalition for Clean Coal Electricity, said the ruling only shows how difficult it is to site new electric generators these days. He said that’s because of continued uncertainty about how greenhouse gas emissions will be regulated.
He said that coal plants elsewhere are still receiving permits, including one in Arkansas earlier this month.
“I know there will be people who will try to spin this as a blow against coal that it is not,” Lucas said.
Nancy Jackson, executive director of The Land Institute’s Climate and Energy Project, said the supporters of new coal-fired generation may view the Utah decision as largely irrelevant.
She said, from their point of view, the EPA has again taken a pass on limiting CO2. But opponents see a victory in the decision, one that “presses pause” on all new coal plants, she said.
“We all know carbon dioxide will soon be regulated,” Jackson said. “The Bonanza decision is a significant and decisive step in that direction.”
Working out the wiggle room – Texas starts grid-proofing for high penetrations of wind power
November 17, 2008
From the New York Times -
The major problem with wind as a power source is that it doesn’t blow all the time. To remedy that, Texas is spending $30 million a year to bolster its back-up power, in a change to the electricity grid that began on Nov. 1.
Depending on the weather conditions and time of day, wind can provide a significant proportion of Texas power – as much as 16 percent at one point in the past week, according to Dan Jones, an independent market monitor for the Texas grid. Wind farms are sprouting so quickly in the western part of the state that Texas’s grid managers decided that they needed extra back-up power to cover shortfalls when the wind stops blowing.
Adding to the sense of urgency, Texas nearly experienced wind-related blackouts in February.
Back-up power sources are always in place to handle minute-to-minute fluctuations in power supply and demand. Some power plants — usually gas plants — stand ready to deliver power at a moment’s notice as needs arise. These plants are responding not just to variations in wind, but to any unexpected uptick or downtick in demand or supply — say, when thousands of people suddenly turn on their air-conditioning at 2 p.m.
Beyond mitigating these minute-to-minute fluctuations, power systems generally maintain a number of back-up plants that are a bit slower to kick in — it takes about 30 minutes or so — but which really form the primary line of defense against blackouts.
In Texas, these back-up plants — typically natural gas plants — are often needed three to five days a month, according to Mr. Jones. It’s at this level of defense where Texas grid managers recently decided that they needed added capacity to account for wind’s variability and its significant place in the state’s power portfolio.
The requirements now call for some of these plants to be available at night, when demand is usually at its lowest. Why? Because nighttime is when the west Texas winds blow the strongest, and thus the risk is greater if the wind dies down. The new rules also require more of this reserve to be available during the daytime.
(Other, rarely used lines of defense against a statewide blackout include switching off the power to certain large users, in accordance with prior agreements, or — in an emergency — shutting off power to certain neighborhoods.)
Adding extra back-up power is only one of several ways that Texas is handling the influx of wind power into its grid. Grid managers are improving their methods for forecasting the wind day to day, said Mr. Jones. They are also trying to figure out ways to ease the strain caused by the rapid, significant changes in the wind, which unlike other supply sources, can very suddenly ramp up or die down.
More transmission lines are also sorely needed. In Texas (as well as in other states), turbines are sometimes forced to shut down on windy days, because there are not enough lines to carry the power they produce to the cities that need it.
Although Texas is far ahead in wind power, with 30 percent of the nation’s installed capacity, grid operators elsewhere in the country will be watching the changes there and improving their own abilities to integrate wind. The New York grid operator, for example, is also introducing better wind-forecasting techniques.
The original story also contains a monthly cost breakdown.
— Maril Hazlett, www.climateandenergy.org
Want a little light reading? Try the Bonanza decision.
November 17, 2008
Download it here. (Light reading was a joke, BTW. Although it’s only 66 pages – which considering what it is, ain’t much.)
Future of energy efficiency policy under Obama administration? What the ACEEE thinks
November 17, 2008
Clipped in from the newsletter of the American Council for an Energy Efficient Economy (ACEEE):
November 13, 2008
WHAT TO EXPECT: ENERGY EFFICIENCY, THE NEW ADMINISTRATION, AND THE NEW CONGRESS
The election is over. President-elect Obama’s transition team has already started its work, and in Congress, new leadership will be elected. What can we expect from the new Administration and a new Congress on energy efficiency policy? Probably quite a bit, since Obama emphasized energy (principally energy efficiency and renewable energy) as one of his key issues (along with the economy, health care, and education). There will also be a lot of interest in energy efficiency from Congress, given expanded Democratic majorities in general and some of the newly-elected Senators in particular (e.g., Tom and Mark Udall, both of whom were very active efficiency supporters when they were in the House). While many Republicans support energy efficiency, probably a higher proportion of Democrats think government should do more to support efficiency. On the other hand, all major legislation requires 60 votes in the Senate, which means that moderate Republicans, such as new Senate Energy and Natural Resources Committee Ranking-Member Lisa Murkowski (R-Alaska), and moderate Democrats have to be on board.
In terms of new legislation, ACEEE expects energy efficiency to come up in three major places—an economic stimulus bill, energy legislation, and climate change legislation.
Given the state of our economy, an economic stimulus bill is the next order of business. Congress may well pass such a bill in November or December, even before the new President and Congress are sworn in, but if not then, probably in the first month of the new Congress. There could also be two bills, one in the waning days of 2008, and one in early 2009. Such bill(s) will include many provisions, such as extension of jobless benefits and perhaps some tax rebate checks. But there’s a reasonable chance that energy efficiency investments will be included, such as extra funds for the low-income weatherization program, funds to upgrade schools and municipal buildings, a green jobs program, and perhaps some type of residential retrofit program, to create jobs and reduce the burden of energy costs on families.
Next up is likely to be an energy bill. The last Congress came close to passing a renewable portfolio standard, and there’s a very good chance one will be enacted in the next year. President-elect Obama’s energy platform calls for an energy efficiency resource standard (EERS), ramping up to 15% savings by 2020, and such a provision will likely be considered. Other potential items for an energy bill include extensions of various energy efficiency and renewable energy tax credits (Congress extended many of these until only the end of 2009), a provision addressing off-shore oil drilling, additional work on clean coal (e.g., House Energy and Air Quality Subcommittee Chair Rick Boucher, D-Virginia, has a major bill in this area), and investments in a green economy (Obama has called for an investment of $15 billion annually for ten years).
Finally, there is climate change legislation. There are many complex issues involved and we would not expect legislation to pass until 2010 or 2011, but a lot of work on such bills will take place in 2009, with bills quite possibly moving out of committee and perhaps even getting debated on the House or Senate floor. Such a bill is likely to be a cap and trade bill, calling for an 80% reduction in emissions below 1990 levels by 2050 (a target that Obama and many Congressional leaders have endorsed). Efficiency is likely to play a significant role since bills advanced by committee leadership in both the House and Senate have significant energy efficiency provisions designed to both reduce emissions and to keep the costs of addressing climate change in check.
Looking to the even longer term, Obama has called for building the green economy as a centerpiece of our economic strategy with investments in basic research, technology demonstration, commercial market deployment, and job training. Targeted areas include advanced vehicles and biofuels, and a smart electric grid. He has also called for:
* weatherizing one million low-income homes a year
* accelerating development of appliance and equipment efficiency standards
* increasing the energy savings in building codes (including grants to states that are early adopters)
* improving the efficiency of federal facilities
* assisting states and municipalities to build green buildings
* increasing vehicle fuel economy standards.
In addition, he wants to expand support for smart growth initiatives and public transit, and support for states that adopt policies to decouple utility profits from utility sales. He also wants to play a leadership role in helping to shape a new global climate change framework. How much of this will see the light of day remains to be seen, particularly given the current state of the economy and burgeoning federal budget deficits. But some of these can be done administratively and/or without spending a lot of money. With energy fairly high on the agenda in the 2008 campaign, significant Congressional action is likely, although exactly what will be in specific bills will only gradually become clear over time.
ACEEE plans to be heavily involved in each of these efforts.
FYI. Kansas ranks 38 out of 50 states on ACEEE’s 2008 Energy Efficiency State Scorecard. Oops.
— Maril Hazlett, www.climateandenergy.org
