SME adds gas-fired facility, wind to its coal-fired project

4 February 2009 – Southern Montana Electric Generation and Transmission Cooperative will seek permitting and financing to build a natural gas-fired facility.

The proposed 80 MW natural gas-fired combined cycle unit will be build on the same site as the utility’s $900 million coal-fired Highwood Generating Station, whose permits have been challenged.

Tim Gregori, SME’s general manager, said that while Highwood has its permits in effect, they are under appeal in a state environmental appeals board. The project will continue despite regulatory uncertainty, he said.

“As with similar projects across the country, opponents have filed multiple appeals of every approval, including the air permit, which has led to significant delays and expense,” Gregori said.

The delays and regulatory uncertainty associated with the appeals led SME to consider other options to meet its imminent need for power by 2011, when its power supply agreement with the Bonneville Power Administration will expire.

“SME has not abandoned the coal-fired plant permit or project, but is considering deferring that project for the time being while it pursues the gas plant option, in order to obtain a power supply source in the near term that will be owned by SME,” he said.

As a result, SME will add the gas-fired unit as well as 6 MW of wind power at the same site as the proposed coal-fired facility. The gas-fired unit will be ready for service by late 2011, he said. SME broke ground on the coal-fired facility this past fall.