Senators Backing Clean Coal Electricity; Cooperatives Benefit From Federal Plan to Build; Traditional Power Plants

 

May 22 - Charleston Daily Mail

West Virginia's two U.S. senators say it's possible to promote coal and clean air initiatives at the same time.

They're throwing their support toward a controversial federal loan program for building coal plants that some say clashes with congressional efforts to reduce greenhouse gas emissions.

The Washington Post recently reported that a federal program uses taxpayer money to provide billions of dollars in low-interest loans for coal plant projects.

The beneficiaries are rural electric cooperatives - organizations composed of rural communities that generate or purchase electricity at wholesale and distribute it to customers.

According to the Washington Post, these cooperatives plan to spend $35 billion in the next decade to build conventional coal plants, a plan that doesn't align with some state and federal efforts to stifle greenhouse gases.

West Virginia has only one rural electric cooperative, the Harrison Rural Electrification Association, in Clarksburg.

Like other rural co-ops, the association gets its funding from the federal Agriculture Department's Rural Utilities Service. But the money it receives is not allocated for building power plants.

The nonprofit electrification agency doesn't produce its own power and is part of Touchstone Energy, an alliance of 600 cooperatives in 45 states.

The association serves 6,107 customers in seven counties - Lewis, Harrison, Doddridge, Taylor, Barbour, Upshur and Mingo.

Right now, the loan program that's under scrutiny does not affect West Virginia, but that could change if other cooperatives form in the state or if the Harrison Rural Electrification Association decides to seek such funds for power plant building, according to congressional staffers.

Those scenarios, though, are highly unlikely, they said, because it will remain cheaper for the cooperative members to get electricity from the merchant market, like other generators.

But West Virginia's senators said they do not view the loans program as counteractive to clean air initiatives.

"Sen. Rockefeller has advocated for co-ops and municipally-owned utilities to be able to get the benefit of clean coal subsidies," said spokeswoman Jessica Stanton. "He knows we can improve the environment and promote coal at the same time. He understands how important co-ops, in particular, have been to improving the lives of people in rural settings."

When the Harrison Rural Electrification Association started up in 1986, it used a $700,000 loan for rural electrification that helped finance services for 360 customers in West Virginia.

Rural utility cooperatives are nonprofit organizations owned by their customers. There are more than 800 co-ops nationwide that distribute electricity and more than 50 that own power-generating plants.

The federal loans program many co-ops have taken advantage of was initially aimed at bringing electricity to rural areas during the Depression.

Not only are critics saying that the program contributes to carbon dioxide emissions, which are blamed for global warming, but they raise concerns it's providing money for electricity expansion in areas that aren't exactly rural, such as suburbs in the Dallas- Fort Worth area, Atlanta and northern Virginia.

Rural cooperatives also rely on coal for 80 percent of their electricity where it is growing at twice the national rate.

Sen. Robert Byrd, D-W.Va., acknowledged the wide use of coal, but said he doesn't believe the next generation of power plants will put the environment in jeopardy.

Byrd called the Post article "false reporting" because he believes the program for building coal plants is well utilized. He also said new plants are encouraged to use newer technologies and alternative fuels.

"Coal already produces half of the nation's electricity - a fact that won't change anytime soon," Byrd said.

He added, "A major player in any such effort must be coal and coal-based technologies, which have been to date primarily directed toward electric power generation. However, alternative fuels made from coal can burn cleaner and perform better than petroleum fuels."

Over the past few years, the country's leaders have expressed increasing alarm over the loan program.

In his fiscal 2008 budget, President George W. Bush asked Congress to tighten the program's lending rules.

The Office of Management and Budget wants to end loans for new power plants, but program backers, who say coal plants are necessary for inexpensive electricity in rural areas, have kept the program rolling.

Several House members have signed a letter requesting the program continue in its existing form.

Rockefeller said he believes cooperatives should be provided funding as long as they use clean technologies.

Stanton said, "Sen. Rockefeller believes the benefits of federal clean coal incentives should be available to any utility - whether it is investor-owned, cooperative, or municipally-owned - that seeks to install the cleanest, new technology."

Contact writer Jake Stump at jakestump@dailymail.com or 348- 4842.

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