Tallahassee to consider coal plant in upcoming weeks

Tallahassee to consider coal plant in upcoming weeks

Jul. 1--By Todd Wright, Tallahassee Democrat, Fla. Knight Ridder/Tribune Business News

Tallahassee's power needs will take center stage in the next two weeks as city commissioners are expected to decide whether to help pay for a new coal-fired plant in North Florida.

The city likely would be asked to pay at least $6.3 million to join the group of utility companies proposing the plant, but the money doesn't guarantee the city would stay in the project.

Officials hope a plant using coal to generate electricity would translate into lower utility bills for customers because the city is now dependent on natural gas, a product of a 1992 referendum against a coal plant. Environmentalists worry about the air and water pollution a coal plant would produce.

If the city joined the partnership, the plant would have to be at least one county away. The leading site is Taylor County, where the utility group has had a hard time negotiating with the owners of about 2,500 acres of forest. The group has also been in contact with landowners in Madison County and elsewhere in the region.

The public will be allowed to speak out on the issue at a hearing Wednesday before commissioners make their decision July 13.

The city could back out of the project even after paying to join it, but there's no guarantee it would get all the money back, said Kevin Wailes, general manager of Tallahassee's electric utility. Tallahassee's full share of building the plant would be about $300 million.

"Right now, they have no commitment to us, and we have no commitment with them," said Rick Fernandez, an assistant city manager. "If something else comes along that is of more benefit for our rate payers or if the price of the plant were to become unreasonable, then we'd have to look at that."

The city was approached last month about helping build the plant. It would cost about $1.4 billion; for about 20 percent of the cost, Tallahassee would receive about 20 percent of the electricity. The plant would open in 2012.

Though the city hasn't been given a deadline to join the project, it would likely move forward without its participation.

The cost of the initial buy-in gave some city leaders pause Thursday.

City Commissioner Allan Katz and others raised the possibility of joining forces with more utility companies to help limit the city's cost. David Byrne, Tallahassee's power marketing manager, said the city has already been approached by several companies.

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