Dec 22 - McClatchy-Tribune Regional News - Erik Robinson The Columbian, Vancouver, Wash.

Richland-based Energy Northwest will push forward with a 793-megawatt power plant at the Port of Kalama, despite a major setback with state regulators last month.

However, the consortium of 20 public utilities in Washington will most likely pull the plug on its plan for a $1.5 billion coal-gasification plant. It's likely that the consortium will instead turn toward natural gas as the primary fuel.

Energy Northwest had intended to make its Pacific Mountain Energy Center the first coal-gasification power plant on the West Coast.

The consortium planned to fit the plant with stubs enabling it to someday inject carbon emissions deep underground -- a process known as sequestration -- rather than spewing heat-trapping gases into the atmosphere. However, officials with the consortium argued that such technology is not economically feasible right now; instead, the consortium intended to offset those emissions through the purchase of carbon "credits" or other means.

That didn't fit with a new state law intended to curtail Washington's contribution to global warming.

The Washington State Energy Facility Evaluation Council on Nov. 27 rejected Energy Northwest's greenhouse gas reduction plan as insufficient under the law, deriding it as a "plan to make a plan."

"We intend to move forward with an amended development plan for a power plant that provides reliable, affordable and environmentally responsible electric power without the sequestration option," according to an Energy Northwest statement issued by spokesman Brad Peck on Friday. "The amended plan will likely result in higher power costs for the electric ratepayers than our original proposal."

Natural gas is the most likely possibility, although Peck wouldn't comment on Energy Northwest's next move other than to say it will amend its application within 60 days.

The new law steers Energy Northwest toward natural gas.

That's because the law, sponsored by state Sen. Craig Pridemore, D-Vancouver, sets a high hurdle for development of plants using the new clean-coal technology envisioned by Energy Northwest for Kalama.

The technology, known as integrated gasification combined cycle (IGCC), involves breaking down coal or other fossil fuel into its component parts, stripping out harmful elements such as mercury and sulfur, and burning the remaining gas to generate electricity.

The law limits new energy plants to 1,100 pounds of greenhouse gas emissions per megawatt-hour, a standard equal to emission levels of the newest generation of natural gas-fired plants.

"If (Energy Northwest) wants to propose a natural gas plant with pre-fitting for possible later IGCC operation, based on a future application for that purpose, it is free to amend its application to do so," according a clarifying order signed by Energy Facility Evaluation Council Chairman Jim Luce on Friday.