Utilities say customers could pay for EPA's bad timing on pollution rule

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November 8, 2011 - 6:00pm

Nebraska utilities are frustrated by new regulations from the Environmental Protection Agency that will force them to make quick decisions about their use of coal to generate electricity.

The EPA's Cross-State Air Pollution Rule is designed to limit emissions from fossil fuel burning power plants in 28 states, including Nebraska, where the pollution is drifting across state lines. Supporters insist that the EPA move forward to protect public health, but utilities complain the agency has not afforded enough time to make upgrades at coal plants that they estimate will cost millions.

Grant Gerlock, NET News

Three smokestacks rise above the Lon D. Wright power plant in Fremont.

Map created by Hilary Stohs-Krause, NET News

The map above shows the locations of the seven coal plants in Nebraska; when you go to a larger version of the map, you can click each icon to see how its emissions would have been affected by the regulations proposed in summer 2010, how they will be affected by the revised regulations released in Oct. 2011, and the difference between the two standards.

Grant Gerlock, NET News

The 120 megawatt facility is one of the state's smaller coal plants. It burns 340,000-350,000 tons of coal each year.

The Lon D. Wright power plant in the eastern Nebraska town of Fremont is one of seven coal-burning plants in Nebraska that will be impacted by the EPA's cross-state rule. Derril Marshall, general manager of utilities in Fremont, said the department's 14,000 customers can expect to pay more for electricity if no further changes are made to the cross-state rule.

"If I had to estimate a number," he said, "I'd have to say a 20 to 25 percent rate increase by the time we're all done."

Utilities are also dealing with the surprisingly low budgets for coal emissions being set by the EPA. Nebraska Public Power District Environmental Manager Joe Citta said the final cross-state rule was more restrictive than the original proposal.

"We felt the proposed rule was manageable," Citta said. "We would have had to do some things. But they were certainly more achievable than this additional 40 percent reduction."

At NPPD's Sheldon Station near Lincoln, the EPA changed from a 10 percent reduction of nitrous oxide under the proposed rule, to an 80 percent reduction in the latest revised numbers.

The new emissions targets go into effect in January 2012. Several elected officials have called on the EPA to give utilities a longer timetable: Nebraska Republican Sen. Mike Johanns introduced a bill in the U.S. Senate that would require the EPA to delay the cross-state rule an additional 3 years.

"We're all for cleaner air," Johanns said. "The issue is whether power providers can make these changes on the timeline that EPA is requiring, and everyone, even the EPA, acknowledges it's not possible."

But public health advocates support the EPA's new regulations. Janice Nolen, vice-president for national policy and advocacy for the American Lung Association, has called on the EPA to stay on schedule to reduce emissions of nitrous oxide and sulfur dioxide, which are linked to serious health complications.

"The bottom line is that people are already paying the cost," Nolen said. "The people of Nebraska are paying the cost. The people of Wisconsin are paying the cost in early deaths, in heart attacks and asthma attacks, in days missed from work."

The EPA estimates that by reducing the emissions, 34,000 premature deaths would be prevented across the U.S. each year. Thousands of heart attacks and asthma attacks might also be avoided. Cutting emissions in Nebraska could make air cleaner to breathe in communities hundreds of miles downwind.

"In fact, some places in this rule are in Pennsylvania, and are being polluted by states as far away as Mississippi and Georgia," Nolen said. "But also remember, the folks in Nebraska are benefitting from pollution that's not going to be blowing into Nebraska. So it works both ways."

Grant Gerlock, NET News

The orange glow of the coal fire is visible through a small porthole by the burners at the Fremont power plant.

Grant Gerlock, NET News

Derril Marshall, General Manager of the Fremont Utilities Department, stands near one of the steam driven power turbines.

In Fremont, new coal burners could knock down emissions of nitrous oxide. Scrubbers could be installed on the smokestacks to remove more sulfur particles. Derril Marshall expected the power plant would need to be upgraded sooner or later, but the usual process would take four to five years. He said he doesn't think the EPA gave utilities enough time to make changes in the right way.

"It forces you to do those much quicker than you would like to," he said. "And you'd like to have a little more opportunity to plan and make sure you're doing the best thing and getting the best price on bids."

Until utilities make the necessary upgrades, the only way to avoid fines from the EPA is to cut back on power generation, which cuts into revenues.

NPPD may be forced to sell less power outside the state. The utility said exporting excess electricity is a good moneymaker; Over the hot summer months, extra power was sold to places like Kansas, Oklahoma and Texas, bringing in an extra $6 million to $7 million. Normally, that money would help pay for updating substations and transmission lines so that fewer infrastructure costs are billed to local customers. Instead, the money will be used to pay for improvements related to the cross-state rule, and regular maintenance might be pushed to the back burner.

The EPA suggests that is the price to pay for the hidden costs of coal energy.



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