Don’t ban coal for electricity generation.
That was the plea from utility officials and state regulators trying to cope with the flood of regulations now coming out of the Environmental Protection Agency.
Frank Prager, Vice President of Xcel Energy, said Xcel has worked with regulators in Colorado and Minnesota to cut pollutants and greenhouse gases by adding more wind power than any other utility and by closing or converting coal plants to natural gas.
But while taking those measures, Xcel also opened a new supercritical coal plant in Colorado for baseload power wind can’t supply.
“Banning new coal is not necessary” to achieving needed GHG reductions, he told the National Association of Clean Air Agencies, the National Association of State Energy Officials, and the National Association of Regulatory Utility Commissioners in Washington, DC this week.
Rule Would Make Older Gas Plants Non-compliant
The proposed GHG rule would allow new coal plants only with carbon capture and sequestration, but that technology has serious legal and economic issues, said John Voyles, Vice President, LG&E and KU Energy. “The proposed rule effectively eliminates coal,” and may be too stringent for normal operations of simple-cycle natural gas combustors as well, he said.
EPA has proposed a GHG standard for electricity generation of 1,000 pounds carbon dioxide per megawatt-hour, which is a little over half what coal plants produce, but above what efficient natural gas plants can do, effectively putting the average gas plant in compliance and many coal plants out.
If those rules are applied to older plants, the result would be “catastrophic” for coal-heavy utilities like his Kentucky companies, Voyles said.
The GHG rule is coming as new rules are taking effect on mercury and other toxics, and as standards for pollutants like sulfur and nitrogen are being tightened, increasing the costs of burning coal, particularly at older plants without pollution controls.
Coal retirements and retrofits to meet pollution standards have already forced regulators to allow rate hikes of 14% for LG&E and 18% for KU, said James Gardner, Vice Chairman, Kentucky Public Service Commission. He said businesses are threatening to move off-shore due to rising energy costs.
the result would be “catastrophic,” – Voyles
Jeffrey Burleson, Vice President, Southern Company Services, said the range of EPA rules is estimated to cost Southern’s generators about $2,000 per kilowatt to comply.
EPA Assistant Administrator Gina McCarthy insisted EPA is not making technology judgments about how GHG and pollutant reductions should be achieved. “Our rules focus on public health,” she said, adding that EPA tries to ensure there are alternate methods of compliance.
EPA’s GHG limits are only proposed rules, and only apply to new plants, not existing ones. McCarthy said decisions have not been made on how to tackle GHG emissions at existing generating plants.
So far, McCarthy said, EPA has received about 2 million comments on the proposal, which must be read before the proposal can move forward.
Voyles said EPA should promulgate a separate GHG standard for coal, not a single emissions standard that all plants need to meet, and a standard that can be averaged across fleets to allow for variation in operations.
The Neighbors are Getting Restless
Pleas for EPA to move forward, on all fronts, came from several downwind states. Officials from Delaware and Maryland said they are experiencing a terrible ozone summer due to pollutants blown their way from upwind coal-burning plants.
“Seventy percent of our pollutants come from upwind states,” said Tad Aburn, Director of Maryland’s Air and Radiation Management Administration.
“We have to pay the consequences of uncontrolled coal upwind,” with restrictions on in-state development, said Collin O’Mara, Secretary, Delaware Department of Natural Resources and Environmental Control.
Air measured at both Maryland’s and Delaware’s western borders already violates standards, they said.