Critics see holes in power plant study

 

Jun 15 - McClatchy-Tribune Regional News - Rindi White Anchorage Daily News, Alaska

Matanuska Electric Association critics say the utility didn't do enough homework before agreeing to build a 100-megawatt coal-fired power plant as its primary power source by 2015.

The MEA board of directors on Monday released the report by engineering consultant CH2M Hill on which the board based its decision. The plan recommends building by 2014 a coal-fired plant and a supplemental, 100-megawatt natural gas plant.

MEA released an executive summary of the report earlier this year.

"It looked like there were a lot of holes in it, a lot of unsupported assertions," said UtiltyWatch president Jim Sykes. "It's still clear to me that they didn't thoroughly explore all other options."

Sykes said he had hoped to see more information about large-scale hydroelectric projects, such as Lake Chakachamna, a hydroelectric project near Mount Spurr being studied by TDX Power, an Aleut power and fuel supply company. A 1983 study estimated the project would generate up to 330 megawatts, twice the power MEA estimates it will need by 2014.

The CH2M Hill Integrated Resource Plan provides a status report of the Chakachamna project and states, "MEA will continue monitoring progress on this project."

MEA spokeswoman Lorali Carter said Chakachamna isn't foremost in the utility's plans for two reasons: It's not operating, and the cost to develop it, according to CH2M Hill, is roughly $4.25 billion.

The utility has estimated its power generation plants together would cost $350 million.

Anchorage utility and pipeline consultant Mark Foster said he thinks that estimate is artificially low and that the CH2M Hill study was based on faulty data.

"There's not a lot of information to support the assumptions that MEA made," Foster said Thursday.

For example, the CH2M Hill report is based on plans by Chugach Electric Association to build a coal-fired plant across Knik Arm, near Beluga. But Chugach officials say those plans have been shelved. The project was deemed too expensive, said Chugach spokesman Phil Steyer.

"What staff has recommended for generation plans is a new, gas-fired generation plant by 2011," Steyer said Thursday. "That's the plan we're proceeding with."

Carter said that if Chugach ditched the coal plant, it has not made that decision clear. Its most recent generation plan includes the coal-fired plant, she said.

MEA spokesman Tuckerman Babcock said Chugach officials at a May 16 board meeting listed coal as part of its future generation plans.

It's not clear how MEA's resource plan would change if the Chugach coal-fired plant were no longer a factor that CH2M Hill considered in its report.

"Are they deliberately creating scenarios to make it look like 'Those are expensive and mine's better'?" Foster asked.

Foster previously served on the Alaska Public Utility Commission as docket manager on the state's Healy Clean Coal project. In May he completed a pro bono review of part of the CH2M Hill report for MEA Ratepayers Alliance, a group fighting MEA plans to build a coal-fired plant.

Will Alteneder of Eagle River, a chemical engineer who narrowly lost a race this spring for the MEA board, said his cursory review of the CH2M Hill plan revealed some significant gaps.

"I think they rushed to action, based on this one report," Alteneder said. "Particularly when you have this other information from Mark Foster."

Alteneder has asked the MEA board to pay for a peer review of the resource plan.

"The small amount of money it costs to do that is insurance," Alteneder said. "It is very standard practice on large projects to do that. I'm not asking for anything unusual."

Carter said peer reviews on resource plans are not common practice among public utilities. MEA hired an independent consultant, CH2M Hill, to get independent data, she said.

Sykes said he's still trying to understand why the report, furnished to MEA in 2006, was kept confidential for so long. The utility should have made the information public before authorizing its general manager to purchase land for a future power plant, he said.

"This should have been let out months ago," Sykes said. "Now they're taking another step, which they shouldn't take, buying land. I think the sentiment is pretty clear: People don't want a coal plant."

 

IF YOU GO:

--Matanuska Electric Association Ratepayers Alliance has scheduled a 7-9 p.m. meeting Wednesday at Palmer High School Little Theater. The watchdog group will hear from speakers about the potential cost of utility cooperative MEA's future generation plans.

--On the Web: Review Mark Foster's report for MEA Ratepayers Alliance under "documents" at www.mearatepayers.com