Court Rules on EPA Water Challenge
Technology and not cost-benefit analysis must drive power generators’ compliance with a U.S. Environmental Protection Agency rule aimed at reducing aquatic life impingement and entrainment at power plant water intake structures. That decision was handed down in January by the U.S. Second Circuit Court of Appeals in Manhattan. Judges reviewed aspects of the EPA’s 2004 rules known by the shorthand “section 316 (b)”, under the federal Clean Water Act.
(See the January issue of Power Engineering magazine for more on section 316 (b) and its potential implications for power generators.)
The court order said power plants must adopt “best technology available” and that cost-benefit analysis “cannot be justified” given Congress’ intent in enacting the Clean Water Act. The court said the Act was meant to be “technology-forcing” and not driven by cost considerations.
The court said, however, that the EPA may consider cost to determine what technology can be “reasonably borne” by the industry and also to conduct cost-effectiveness analysis in determining best technology available.
The order sent back to EPA the agency’s decision not to require closed-cycle cooling as “best technology available” to comply with 316 (b). The court said the record was unclear as to how the EPA concluded that closed-cycle cooling costs “could not be reasonably borne by the industry.”
The court order cited earlier EPA information that said closed-cycle cooling at all 539 power plants affected by the rule would cost some $2.26 billion and close nine plants.
The court dismissed an Entergy argument that the rule would have a disproportionate affect on nuclear power plants, due to what the operator said were “unique safety concerns” related to the stable flow of cooling water. The court said EPA had considered and responded to nuclear operator comments during its rulemaking phase and allowed for nuclear operators’ concerns by providing a site-specific compliance alternative. The provision requires that nuclear plants must show that the Nuclear Regulatory Commission agrees that a safety conflict exists. The EPA then would decide which “best technology available” would minimize adverse environmental impact and avoid a safety conflict at the specific plant in question.
The EPA or industry groups could appeal to the U.S. Supreme Court. The same court struck down in 2004 similar regulations pertaining to newer plants. The EPA did not appeal that ruling.
Wyoming Coal Up 10 Percent
Published reports say Wyoming’s coal production rose 10 percent in 2006 even as nationwide coal consumption fell 1.2 percent. The increase came from efforts to rebuild stockpiles of Powder River Basin coal at power plants.
Wyoming coal mines shipped more than 446 million tons last year. That was up by about 43 million tons from 2005, according to a Casper Star-Tribune newspaper survey and data from the Energy Information Administration.
Marion Loomis, executive director of the Wyoming Mining Association, was quoted as saying better railroad capacity was the main reason for the increase. He said 2005 would have been a better year except for train derailment problems.
UP officials say they and the BNSF railroad have been working with four PRB coal producers to allow shipment of up to 600 million tons of coal by 2012.
Duke Chairman Lauds GHG Tax
Duke Energy Chairman Paul Anderson told Sierra Club members in California that he believes carbon tax legislation is a good idea. “From a businessman’s standpoint, that’s what is going to compel action,” Anderson said, speaking before a global warming workshop. Congress is expected to give renewed consideration to a carbon tax, moving away from a cap-and-trade approach that went into effect in Europe in January 2005.
Anderson said cap-and-trade approaches are too flexible, too slow and too prone to “political mischief” because they can exempt one industry or another. He said taxing carbon emissions will produce immediate, economy wide gains in energy efficiency and carbon-free energy production.
“All the other approaches will take decades,” he said. “A carbon tax is immediate.” Assuming it’s a tax-neutral policy, “it’s really no-regrets policy,” he said. “If you don’t agree climate change is a serious problem, all you’ve done is create some energy efficiency out there and that’s not a bad thing.”
IGCC Gets Green Light in New York
NRG Energy has received a conditional award of a contract from the New York Power Authority (NYPA) to build a 680 MW integrated gasification combined cycle (IGCC) plant at its existing Huntley plant site in Tonawanda, N.Y. The project, estimated to cost about $1.5 billion, is scheduled to go into commercial operation in 2013. NRG is currently decommissioning four of the six coal-fired generating units at the Huntley station in line with a 2005 settlement to reduce emissions of sulfur dioxide (SO2) and nitrogen oxides (NOX).
The award is conditional because IGCC cost is about 20 percent more than the current market price for a new pulverized coal (PC) coal plant. NRG and NYPA plan to pursue tax credits or other federal and/or state funding sources to bridge the cost gap.
The proposed IGCC would be next to the Huntley Generating Station and would use existing plant infrastructure including rail, coal handling, water and transmission facilities. The conditional agreement with the state authority includes a 20 year off take contract.
 By 2013 NRG Energy hopes to have a 680 MW IGCC plant at the Huntley site in near Buffalo, New York. Illustration courtesy of NRG Energy. |
NRG has also filed for a permit to convert existing coal-fired units at the Indian River Plant in Delaware to IGCC technology. As part of that proposal, NRG has offered to retire Indian River Units 1 and 2 contingent on receiving a 400 MW power purchase agreement with Delmarva Power, effective on the new IGCC’s commercial operation date. The proposal would result in an estimated 88 percent emissions reduction for every megawatt-hour of electricity produced at Indian River.
NRG had originally filed for permits to convert its plant at plant in Montville, Conn., to IGCC. But the power delivery timeframe included in the Connecticut request for proposal was too near-term to allow for development and construction of any coal plant-IGCC or PC-and NRG withdrew its proposal.
Shell will provide its entrained flow, dry feed, membrane wall gasification technology for NRG Energy’s proposed plant conversions. NRG pointed to what it said were Shell technology’s “higher availability” relative to other technologies, low fuel use, low CO2 production, fuel flexibility (compatibility with most coals including sub-bituminous and lignite in addition to petcoke and biomass), fast startup and shutdown times and low maintenance costs.
PG&E to Complete Gas-Fired Project
Pacific Gas and Electric Company (PG&E) is stepping in to complete construction of a 530 MW gas-fired combined-cycle plant near Antioch, Calif. The partially completed plant was acquired by the utility in 2005 from independent power producer Mirant. Originally called Contra Costa Unit 8, PG&E renamed it Gateway. PG&E is incorporating dry cooling that will use 97 percent less water and produce 96 percent less discharge than conventional water cooling, thus avoiding using water from a nearby river. The utility has not built a power plant in 20 years.
Good News for Wind
Although it provides only a small fraction of U.S. power generation, wind capacity continues to grow by leaps and bounds. And a flurry of recent developments are blowing in wind’s favor.
A study examining how utilities can manage growing amounts of wind capacity says that under the right policies utilities can incorporate wind power into their resource portfolio to a level comprising up to one-fourth of delivered energy without sacrificing reliability and incurring only minor costs associated with absorbing the wind.
The Midwest Wind Integration Study, required by Minnesota’s legislature to evaluate reliability and other impacts of higher levels of wind generation, was conducted by EnerNex Corporation and WindLogics. The Minnesota study found that the total integration cost for up to 25 percent wind energy delivered to all Minnesota customers is less than one-half cent ($0.0045 cents) per kWh of wind generation.
Wind capacity is predicted to eventually represent about 25 percent of the generating capacity for the Midwest System Operator (MISO), which is a higher percentage currently provided nationwide by nuclear power and about the same as natural gas and hydropower combined.
“This study is groundbreaking in its examination of the highest level of wind energy penetration ever undertaken in an authoritative U.S. power system study,” said Utility Wind Integration Group (UWIG) Executive Director J. Charles Smith. UWIG brings together utilities that have wind on their systems or are interested in its development. Smith notes that Denmark and several regions in Europe have already achieved such high levels of wind energy use. “What this study provides is insight into how such levels can also be accommodated here in the U.S., and the conclusion is clear: under good system conditions such as those in the MISO service territory, wind energy can be readily integrated into the utility system,” he says.
“The study is especially significant both because of the amount of wind involved and the fact that it was sanctioned by the Minnesota legislature,” said Mike Jacobs, deputy policy director for the American Wind Energy Association (AWEA). “The Minnesota study shows that, when the wind generation is spread around the state, and MISO markets and operators do what they do best, integration costs are a small concern. Like the studies that have come before, this report shows the relative ease in absorbing the wind - opening the way for wind energy’s benefits to be reaped on a large scale for consumers and for our economy, environment, and energy security.”
Beth Soholt, director of Wind on the Wires, termed the study an important to achieving a higher level of wind penetration in the Midwest.
Meanwhile, several recent events are generating momentum for the wind industry, including the extension by Congress of the renewable energy tax credit to give wind farm construction a boost in 2007 and 2008. Although wind currently provides less than 1 percent of the electricity in the U.S., it is now the second-largest source of new power generation for the second year in a row, after new natural gas plants. “Wind power now offers a mainstream option with which to meet our growing electricity demand,” said AWEA Assistant Director of Communications Christine Real de Azua.
Still, opposition plagues wind development just as it does every other kind of energy source. And wind energy proponents have found themselves at odds with some of the constituencies they have relied on for support. Conservationists have pointed to condor casualties in California, bat fatalities in Appalachia and potential damage to marine life in Massachusetts.
John Flicker, president of the National Audubon Society, wrote a column in the November-December issue of the Society’s magazine stating he “strongly supports wind power as a clean alternative energy source,” and sees global warming as a much larger threat to bird species than accidental avian deaths from wind turbine blades.
Other concerns about wind facilities have been expressed by military and air traffic controllers, who have cited wind farms as potential national security threats due to possible interference with Doppler radar. A recent report from the Idaho National Laboratory shows that the reflection from a wind turbine tower and disturbance from blade rotation can sometimes affect Doppler systems. But the report found these problems can be mitigated by site planning and inter-agency cooperation among the Department of Energy, U.S. Air Force and the Federal Aviation Administration.
The U.S. Department of Defense (DOD) conducted a study on national security impacts from wind turbines in 2006 that produced inconclusive results. The DOD calls for more research into mitigating the effects of radar interference, but acknowledged that the United States should allow construction of wind turbines while maintaining defense readiness capabilities.
“Decades of experience tell us that wind and radar can coexist,” said AWEA executive director Randall Swisher. “The American wind energy industry will continue to work collaboratively with government and others on efforts to constructively address challenges and refine solutions. ”
Wind has faced hostility from some of its civilian neighbors as well, with complaints escalating about visual and noise pollution along with complaints about transmission lines built across landscapes to connect wind turbines to the grid (see “The Coal-Wind Connection”, Power Engineering, January 2007). Such complaints have resulted in some of the first lawsuits against wind farms since the wind construction boom began several years ago. Two cases were decided in December and the decisions could establish precedent for future lawsuits.
One case was in Texas, where Horse Hollow is the largest wind farm in the world, consisting of 421 turbines producing 735 MW. But 18 plaintiffs near the farm sued owner FPL Energy charging the wind turbines created enough noise to constitute a private nuisance.
The Abilene jury disagreed and issued a “take-nothing” verdict, finding that Horse Hollow is not a private nuisance. The case was closely watched by energy industry observers because of the potential impact on future wind farm construction. FPL Energy has invested more than $1 billion in its Texas wind farm operations, and a negative outcome in their case could have had a chilling effect on wind investment.
Far from Texas, the Cape Wind Project, which would be the first U.S. offshore wind farm, is planned to be built off Nantucket Sound in Massachusetts. Energy Management Inc.’s plan to build the 420 MW farm of 130 wind turbines has raised the ire of local groups. Sentiment against the project has marshaled a group of activists called the Alliance to Protect Nantucket Sound that has spent millions of dollars to stop construction.
The most recent action against the project was an appeal to the Massachusetts Supreme Court regarding a May 2005 decision by the Massachusetts Energy Facilities Siting Board (MEFSB) approving construction and operation of undersea transmission lines to serve the Cape Wind Project. The MEFSB approved the application following a 32-month review.
In December, the Massachusetts Supreme Juicial Court ruled unanimously in favor of the MEFSB decision, acknowledging the MEFSB’s approach in determining that the transmission lines were needed to serve the wind farm, even though the wind farm itself will require the approval of federal agencies.