ENERGY:

Foes of coal see hope in cancellation of Iowa plant

But developer says it’s going ahead with plans for plant near Ely, despite losing partner

Monday, Jan. 12, 2009 | 2 a.m.

Coal Power Plant Debate

LS Power

LS Power, a developer proposing a large, coal-fired power plant near Ely, last week canceled plans for a similar plant in Iowa, and opponents of both plants are hailing the decision as yet another sign that coal is in trouble.

The announcement Tuesday that LS would not build a plant in Waterloo, Iowa, came only days after development partner Dynegy dissolved its partnership with LS. The companies had plans to develop coal plants in Arkansas, Georgia and Michigan, as well as Iowa and Nevada.

Dynegy’s stock rose 19 percent Jan. 2 on the news it was shedding coal power development, and the controversy it brings, as part of its business plan. Environmentalists say Wall Street doesn’t think coal is a good bet for investors, let alone ratepayers. Both groups must contend with uncertainty over the future price of coal-fired power, which is affected by escalating coal prices, high construction costs and potential carbon legislation.

But Mark Milburn, director of project development for LS, said his company is “moving forward full speed ahead” with plans to build a 1,590-megawatt plant in Nevada.

“Dissolving the (joint venture) between LS Power and Dynegy (means) that LS Power now has 100 percent control and funding responsibility for development of the White Pine Energy Station and the ... transmission line,” Milburn said. Dynegy’s withdrawal means LS can continue to “do what we do best — develop fundamentally sound projects in attractive markets.”

Western Resource Advocates’ Charles Benjamin said the permitting process for the Nevada plant is too far along for the company to give up on it. Benjamin said most of the money the company planned to spend on permitting for the White Pine Energy Station has been spent.

“But the fact that a big company like Dynegy is pulling back on ... coal plants ... tells you something about the future of coal,” he said.

Environmental groups in Nevada fear the plant, and two others proposed here, would mar pristine air in Zion and Great Basin national parks and contribute to climate change with its greenhouse gas emissions. Many health care professionals also believe pollution from the plants would harm people with asthma and other breathing conditions.

Benjamin and other opponents emphasized the Nevada project is far from a done deal.

Although the plant recently completed a lengthy environmental review and was granted final approval by the Bureau of Land Management, it is awaiting an air permit. That permit, which would regulate emissions from the plant, is unlikely to be released before Jan. 20, when Barack Obama becomes president and brings with him a new Environmental Protection Agency administrator and Interior secretary and possibly a host of new environmental regulations.

Although Nevada’s Environmental Protection Division, which carries out EPA regulations on the local level, at one point planned to release the final air permit for the plant by the end of 2008, division spokesman Dante Pistone said Wednesday it was unclear when the permit would be issued. The division is still reviewing an EPA appeals board’s rejection in November of a similar air permit for a Utah coal plant because it didn’t limit greenhouse gas emissions. Outgoing EPA Administrator Stephen Johnson subsequently issued a contradictory memo saying air permits need not limit greenhouse gases, which sparked a new lawsuit by environmental groups.

The controversy over the Utah plant’s emissions stalled White Pine Energy Station’s permit, and is a prime example of how a coal plant can be far from breaking ground even when its developers have a fistful of final permits.

Even if the White Pine plant gets its air permit and the Nevada Public Utilities Commission decides the plant would not harm the environment more than it would benefit the state with its electricity, LS will face legal challenges from environmental groups.

“Environmental appeals are expected,” Milburn said.

Members of a coalition of environmental groups opposing LS’s plans say they will appeal the BLM decision, and will likely file a separate appeal if the Nevada Environmental Protection Division grants an air permit.

The first challenge will likely be filed by Jan. 21 before the BLM’s Interior Board of Land Appeals, which hears administrative challenges to environmental review and right of way the BLM granted LS in December. That review would be simpler and faster than going to federal court, the next step for environmental groups, said one environmental attorney working with Nevada’s environmental coalition.

Opponents of the plant say they have a strong case under either appeal.

“One glaring point is that the BLM, while acknowledging that there is a problem with global warming, takes the position that you can’t determine the damage from one ... facility,” Benjamin said. “There has been a general avoidance of this issue during the last eight years of the Bush administration ... and it trickles down to specific projects.”

Another environmental attorney said it’s problematic that the BLM approved the plant without a final air permit, which includes the final analysis of the plant’s emissions.

“There has been no determination of whether the air impacts are acceptable or not,” the attorney said. “The BLM shouldn’t have said they were until (the air permit was) done.”

And the coalition says it’s also concerned about e-mails a BLM contractor wrote in 2007 about how thorough the analysis of cumulative impacts on air quality should be. The initial environmental review of the project looked only at future development in the region. It did not consider past and present development. The contractor thought the analysis should take into account all the impacts. So do environmentalists.

Even if LS gets the permits it needs to build the White Pine Energy Station and survives legal challenges, it must secure financing for the project without Dynegy in a tight credit market.

“Losing a significant financial partner has got to impact their ability to construct,” one environmental attorney said. “There is no indication that they have any customers for the power ... (LS is) trying to get permits in place and find a partner when it comes time to construct.”

That partner is unlikely to be NV Energy, Nevada’s largest utility. The company has proposed its own coal plant near Ely, although permitting of the LS plant is much farther along.

The two companies have also had a frosty relationship, marred by, among other things, conflicts over water resources near Ely. And NV Energy’s long-term plan, which will be updated with the Public Utilities Commission this year, does not include plans to buy power from the White Pine Energy Station.

But Milburn, project development director for LS, says the company has buyers interested in the power White Pine Energy Station will generate, and expects no trouble financing the plant.

“There is going to be a great market for this project,” Milburn said. “It’s clean, it’s safe and it’s needed.”

Discussion: 26 comments so far…

By johnevegas

1/12/09 at 6:20 a.m.

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It's going to be a long time before Nevada needs new power. We should use that time to create newer cleaner energy generation sources and to become more efficient.

We do not need any coal power plants now!
By jfnance32

1/12/09 at 8:13 a.m.

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Solar and wind can not remove or eliminate one watt of capacity from reliable 24/7 generators of energy like gas, coal or nuclear.

Solar and wind can not generate reliable 24/7 power. Therefore when they can not produce power then reliable sources of energy have to kick-in unless people are willing to be without power.

Current expensive storage systems only can store power for 4 to 6 hours. They do have theoretical storage systems that store power for longer but have exorbitant cost.

Many solar and wind plants have zero storage at all. The others only have the expensive storage of 4 to 6 hours.

So if the sun does shine or the wind does not blow than zero power gets generated. Even when the sun shines, solar can only have power capacity for 16-18 hours during the summer.

So a 200 mega-watt coal plant can produce tons of more power than a 200 mega-watt solar plant. That causes the capital cost of a solar plant to be spread out over fewer mega-watts than coal plants. That makes solar power more expensive.

Also wind and solar consume vast acres of land which adds to the cost. Wind and solar are in often in remote rugged areas which drives up the cost of maintainance.

Also add on the cost of paying for costly high power lines to remote spread out solar plants.

I do not know why people want to dot acres and acres of pristine land with solar panels.

Solar and wind are costly affairs.

So let's say that we need an extra 1,000 mega-watts 5 years from now. If we decide to build a 1,000 mega-watt solar plant then we have to build a duplicate 1,000 mega-watt coal plant to be a fall back whenever the solar plant can not produce power. That is duplicating our capital cost for power.

Solar and wind only can only help us to reduce our fuel cost from reliable sources of energy like coal, gas and nuclear.

Our power bills will become like a car payment for an expensive foreign car one day.

No wonder it is hard to find a government entity that wants more than 20% of its power coming from solar and wind.

Because people like Reid and the Sun only want to build solar and wind plants than 10 to 20 years from now we will have an energy crisis. I am sure that we will hear a lot of "Who me?" when that happens.
By energyguru

1/12/09 at 8:35 a.m.

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It's amazing that the so called environmentalists would fight the production of cleaner power. With each new plant defeated, an old, dirty, ineffecient plant built decades ago will continue to operate. With current technology, one new plant can generate more electricity, with less fuel burned and fewer emissions overall.

Thank you very much, sierra club and others of your kind.
By Gordon

1/12/09 at 8:45 a.m.

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75%+ of power is used during the daytime. Peak summer usage is during the day when the sun is shining. Solar still works on cloudy days, just not at it maximum potential. Geothermal is as reliable as coal. As far as wind turbines, they are placed in areas that rarely see no wind.

The only need for more power plants is for daytime peak demand. The overnight hours 75% of power plants are turned off. Building renewable energy power plants do not need storage capacity, they will mainly be used for peak demand.

Studies have shown that renewable energy is cheaper than fossil fuel energy. The building of power plants is comparable in cost, maintaining the plants is comparable in cost, but the FUEL is FREE for renewables. Bottom line, the 20 year average of cost per KWh is cheaper with renewable fuels.

Ignorant people will argue it's more expensive by taking the construction cost and pass ALL of that cost on to the consumer in the first year. Doesn't work that way, the cost is spread over the life of the plant. Look at your recent power bills, the line marked 'temp. green power financing' and the line 'Renewable energy program'. I paid 38 cents last month. That is the cost of the new solar plant.

Lastly, Why coal and not natural gas? Natural gas is much cleaner burning and is abundant.
By dbltrbl

1/12/09 at 9 a.m.

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Gratefully, the coal plant as cancelled. Ely needs to stop the one there. The myth of clean coal-fired power plants is just that, a myth. Just ask the residents in Tennessee; maybe once and for all the Tennessee Valley Authority (TVA) will be held accountable for at least this. Accountability can't be retroactive for past malfeasance.
By jfnance32

1/12/09 at 9:07 a.m.

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"The only need for more power plants is for daytime peak demand."

It is unlike with today's technology that solar power can guarantee that it will make enough power available during peak demand all the time.

Because of that unreliability one will need to build duplicate reliable power plants to kick in. That doubles our cost of power.

"Studies have shown that renewable energy is cheaper than fossil fuel energy"

The bring new state-of-art Solar One plant generates power at least 2.4 times current price of market energy.

I have seen zero studies that show that current price of renewable energy is cheaper than current cost of fossil fuel energy. I have seen many that say the opposite.

Can you name one that does not come from a greenie website and from a regular news source?

If what you are saying is true then they would have been building a ton of solar and wind plants a long time ago.

"Ignorant people will argue it's more expensive by taking the construction cost and pass ALL of that cost on to the consumer in the first year. Doesn't work that way, the cost is spread over the life of the plant."

Capital cost accounting is usually pread out over the life of the plant via depreciation. Most plants are built with bonds that last 30 years and have interest cost.

Because a 200 mega watt solar plant actually generates a ton of less mega-watts than a 200 mega watt solar plant. The operator of a solar plant has to charge more depreciation of capital cost per mega watt than the coal plant operator.

It is like a $10 million car plant that makes 40,000,000 cars a over its life as oppose a $10 million car plant that only makes 10,000,000 cars a over its life. The second plant has to charge more depreciation of the capital cost per car.
By thebs

1/12/09 at 9:36 a.m.

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"The bring new state-of-art Solar One plant generates power at least 2.4 times current price of market energy."

Previously, by Nance (9/1/2008):
"Solar thermal electricity, according to statistics from Schott's publications, will cost around 15 to 17 cents a kilowatt hour in the U.S. Residents of Las Vegas now pay around 7 cents a kilowatt hour. 17/7 = 243%"

Actually, according to the EIA's official energy statistics from the U.S. government, the residential price per kilowatt hour average for Nevada in 2008 was 11.86 cents per kilowatt hour.

http://www.eia.doe.gov/cneaf/electricity...

Using Nance's own estimates of 15-17 cents per hour, the price of solar is 1.26-1.43 times the current average residential price of electricity. In effect, he debunks himself.

Given that Nevada Power was arguing for a 23% increase in residential power rates only two years ago due to the cost of natural gas, those prices could come to parity much more quickly than anyone anticipates.
By jfnance32

1/12/09 at 10:48 a.m.

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Thanks for reinforcing my argument that solar is currently more expensive than other sources.

You are obviously attempting to bump up your numbers by using residential rates only from overall average rates.

The overate rate for 2008 is 10.05 which probably includes the effect of Nevada Energy purchasing the expensive renewable power.

Also, thanks for pointing out an argument on why we should rely more on nuclear and coal than natural gas. Natural gas prices are more acceptable to price changes in the market than coal and nuclear.

The greenies are doing their best to drive up the cost of non-renewables via regulations, tax policy and lawsuits.

At the same time, solar and wind gets tons of taxpayer money in forms of tax credits and direct subidizies and fast tracking in regulatory approvals.

One day they will be like theBS..."See see see... it cost the same now."
By thebs

1/12/09 at 11:19 a.m.

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Yes, your estimates for the cost of solar were far off-base, Nance... in fact, they were nowhere near what you claimed.

Overall average rates are what matters, as that is the only rational base for comparison. Currently, Nevada's power needs are met through a variety of energy sources. Comparing one source of energy to another is, in my view, meaningless without a view of the overall cost of the mix.
By Gordon

1/12/09 at 11:22 a.m.

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Nance, although it's a waste of my time to provide you research, as your opinion is firm regardless of the facts, here are a couple of articles.
http://www.newscientist.com/article/dn10...
http://www.livescience.com/environment/0...

In the infancy of any new industry costs are high. Look at computers costing 2,000-5,000 in the early 90's. Internet infrastructure was built with the 60 cents per minute charged by AOL in it's infancy. Cellular phones costed dollars per minute, plus high monthly access fees in it's infancy. All of the aforementioned industries now cost a fraction of what they did in the beginning. With mass investment in renewables costs will fall dramatically, but we are already at near parity (actually lower when looking at 20-30 years), and the industry is just starting to get mass investments.
By Gordon

1/12/09 at 11:35 a.m.

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Here is another article discussing the Solar One plant in Boulder City.

http://www.reuk.co.uk/Nevada-Solar-One.h...

"The total cost of the project is around $240 million which will price the electricity generated at around 9-13 cents per kWh. However, as more of these facilities are built that price will come down to as little as 7 cents per kWh which is very competitive with fossil fuels today."
By jfnance32

1/12/09 at 11:53 a.m.

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http://www.eia.doe.gov/oiaf/aeo/assumpti...

"Table 38. Cost and Performance Characteristics of New Central Station Electricity Generating Technologies"

This table displays the cost associated with power from brand new power plants.

This supports an argument that the current cost of power from solar is higher than coal and natural gas.

Scrubbed Coal New
Overnight capital cost by $/kW - $1,534
Operation and Maintaince cost (Fixed plus variable) $/kw - $30.95

Adv Combustion Turbine
Overnight capital cost by $/kW - $473
Operation and Maintaince cost (Fixed plus variable) $/kw - $13.32

Solar Thermal
Overnight capital cost by $/kW - $3,744
Operation and Maintaince cost (Fixed plus variable) $/kw - $55.24
By thebs

1/12/09 at 12:37 p.m.

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According to the EIA (a source that you have cited), the All Sectors Average end-use price per kilowatt hour was 9.1 cents in 2006. In 2006, Solar (which includes PV and CSP) generated 0.95 billion kilowatt hours.

According to the EIA, the All Sectors Average end-use price per kilowatt hour will be 10.5 cents in 2030. In 2030, Solar (which includes PV and CSP) will generate 22.51 billion kilowatt hours.

So solar will increase production by 2369.47%, and the average end-price per kilowatt hour to the user will increase by only 15%?

http://www.eia.doe.gov/oiaf/aeo/excel/ae...
http://www.eia.doe.gov/oiaf/aeo/excel/ae...

Nance, how do you reconcile those two statements?
By Future2012

1/12/09 at 2:24 p.m.

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"Studies have shown that renewable energy is cheaper than fossil fuel energy."

LOL

Why is the NV rate increase 17%? Renewables not coal. No coal in that 17%.
By jfnance32

1/12/09 at 2:37 p.m.

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theBS:

They are converting all those numbers into current dollars just to let you know.

Here are the 2008 numbers of energy capacity:

( Table 16. Renewable Energy Generating Capacity and Generation .... Generation (billion kilowatthours))

Solar generates .002 of all renewables
Wind generates .07 of all renewables
Hydro generates .74 of all renewables

( Table 8. Electricity Supply, Disposition, Prices, and Emissions.....Net Generation by Fuel Type Electric Power Sector)

Renewables generate 9.25% of power in the USA
Which means that
Solar generates .002 of all power in USA
Wind generates .07 of all power in the USA

Here are the 2030 prediction numbers:

( Table 16. Renewable Energy Generating Capacity and Generation .... Generation (billion kilowatthours))

Solar generates .04 of all renewables
Wind generates .18 of all renewables
Hydro generates .41 of all renewables

( Table 8. Electricity Supply, Disposition, Prices, and Emissions.....Net Generation by Fuel Type Electric Power Sector)

Renewables generate 13% of power in the USA
Which means that
Solar generates .005 of all power in 2030
Wind generates .02 of all power in 2030

So you are correct that solar and wind are the biggest movers in the big energy mix pie production for 2030 but the still will play minor roles.

In that minor role and yet the biggest movers, they make prices go up 15% in constant dollars.

I would hate to see what impact they would have if the predicted move is even bigger.

Thanks for helping me.
By jfnance32

1/12/09 at 2:49 p.m.

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Correction:

2008 numbers should be

Renewables generate 9.25% of power in the USA
Which means that
Solar generates .0001 of all power in USA
Wind generates .006 of all power in the USA
By johnevegas

1/12/09 at 3:10 p.m.

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It's a good thing I can see through your selective logic nance, otherwise you might make sense.

Solar - Not viable because only works in the daytime.

Good thing that jibes with when most electricity is needed. Seems like a perfect match. And, it does not need to replace anything. It's an offset for now, that works very very well.

Wind - Not viable because only works when the wind blows.

Again, it does not need to replace anything. Like solar, it's an offset that works very well.

To me, these technologies must be developed as much as possible, along with other renewable sources. The issue isn't cost, the issue is efficiency and longevity.
By thebs

1/12/09 at 3:15 p.m.

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Coal:

2006
33.95 nominal dollars per short ton
1.69 nominal dollars per million Btu

2030
58.87 nominal dollars per short ton
2.96 nominal dollars per million Btu

1.73x increase in nominal dollars per short ton
1.75x increase in nominal dollars per million Btu

I believe, given your own astute observations about energy sources and renewables, that the increase in energy prices has more to do with the price of coal-based energy (our largest source of electricity) almost doubling over 25 years, whereas solar is going to increase by over 2000% and still be, according to your numbers, negligible. (A "minor role.")

So "helping you?" Not quite. While the costs of solar have been steadily decreasing, the cost of coal is expected to almost double. The pro-coal lobby is backing a 175% increase in the price of energy from coal-based power plants.
By johnevegas

1/12/09 at 3:33 p.m.

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"While the costs of solar have been steadily decreasing, the cost of coal is expected to almost double."

Not only are the costs of solar going down, so it the cost of lighting. Newer technologies based on High Output CREE LEDs and similar are advancing at an astounding rate. One company is about to bring to market a 380 lumen LED that consumes only 330mw!

It is clear to me that as these technologies become more mainstream, prices will continue to come down and efficiencies will continue to go up.

I've been using LEDs in my yard lights for 5 years now so that I could understand them well. Zero failures, and my 28 floods, spots, and path lights are using less than 35 watts total! A typical setup using equivalent incandescents would consume well over 400 watts.
By jfnance32

1/12/09 at 3:48 p.m.

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theBS:

"whereas solar is going to increase by over 2000% and still be, according to your numbers, negligible. (A "minor role.")"

Which is it? Is solar a major or a minor part of the predicted 2030 energy mix?
By thebs

1/12/09 at 3:55 p.m.

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Well, that remains to be seen, Nance. Much can change in 20 years. We may have a President or Congress that makes a dramatic shift. We may not.

I don't have access to your crystal ball.

But yes, your hysterical cries about how expensive solar is/was/will be don't seem to bear out in our mutually-accepted assumptions.
By jfnance32

1/12/09 at 4:45 p.m.

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theBS:

You were quoting that big number earlier.

You were so happy with EIA's 2030 predictions. They are not my predictions. You are the one who is riding that horse.

You seemed to have a good understanding on reading those tables.

Have you lost your nerve or something?

Is the data from the EIA predicting that solar will have a major or minor role in overall energy generation in 2030?
By thebs

1/12/09 at 4:54 p.m.

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I guess you are struggling with the "mutually-accepted assumptions" part of my last comment. It's pretty simple language, Nance. Try to keep up.

Yes, solar's going to grow exponentially according to the EIA's numbers, and the cost of energy isn't expected to skyrocket, so all your hemming and hawing about how expensive solar is/was/will be is meaningless and hysterical.

Meanwhile the cost of coal-based power is going to skyrocket, and our dependence on fossil fuels will continue to drag our economy down.

Go coal!
By jfnance32

1/12/09 at 6:19 p.m.

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You have lost your nerve.

Tsk...tsk...tsk.......

You once said, "...the average end-price per kilowatt hour to the user will increase by only 15%".....keyword "only"

But now you are hemming and hawing that that coal prices will "drag our economy down" even though according to the AIE data, it is predicating that coal will play roughly the same role it does now in the future....not an significant increase or an decrease.

Which is it now?

Is it "only" a 15% increase or is our ecomony going "down the drain"?

Still waiting on your wisdom about the AIE data.....Is it predicting that solar will play a major or minor role in 2030?
By ks7724a

1/16/09 at 11:13 a.m.

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It amazes me that the myth of clean coal is not adequately discussed in the television news media, however, it does give me hope to see people commenting on just that, even if it is online. We all know that the internet has the ability to affect massive amounts of change, and I hope the issue of clean coal is one of them. I think it's a horrific idea, especially in wake of what happened in Tennessee, to even CONSIDER funding another coal plant. As there is, there are far too many already in existence that pose the same threat to local communities as the one in Tennessee.

If you have not yet discovered it, there is a coalition of many groups dedicated to fighting the misinformation about clean coal. www.powerpastcoal.com has launched a 100 Days of Action to Power Past Coal campaign, and its goal is to provide, through the website, the ability for community activists to add their local events and gather information about clean coal. Please check it out, and let's make this a powerful campaign. In order to do that, we need all the assistance we can get.

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