Energy deal may kill coal plant plan
Aug 21 - McClatchy-Tribune Regional News - Sammy Fretwell and John Monk
The State, Columbia, S.C.
South Carolina's electric cooperatives are negotiating to buy power from
Duke Energy in a move that could be the death knell for a planned
coal-burning power plant near Florence.
The plant, proposed by state-owned Santee Cooper, has drawn waves of
opposition over its potentially negative environmental impact and $2.2
billion cost. But Santee Cooper and supporters have long maintained the
plant would provide much-needed power and jobs to economically depressed
eastern South Carolina.
Now, the Central Electric Power Cooperative -- a major customer of
Santee Cooper -- is talking with the North Carolina-based Duke about
buying energy for five of its 20 member companies, said Dukes Scott,
director of the S.C. Office of Regulatory Staff.
If the cooperatives complete a deal with Duke, it could eliminate the
need for the power station Santee Cooper has proposed along the Great
Pee Dee River, said Scott and three sources familiar with the
negotiations.
Any deal between Duke Energy and the cooperatives would need approval
from the Santee Cooper board of directors as well as from the North
Carolina Public Utilities Commission, since Duke is headquartered in
Charlotte.
"Five co-ops (in the) Upstate and Duke are trying to get a contract for
those five co-ops to buy some power from Duke,'' said Scott, who said
his staff has discussed the plan with Duke Energy and the cooperatives.
"A major part of the co-ops' efforts to achieve this contract was
motivated by a desire to remove the Pee Dee coal plant.''
Electric cooperatives are motivated to buy from Duke because they
believe it will be cheaper than helping pay for a new coal plant in
Florence County, energy experts said Thursday.
Scott said his agency supports the sale because it would keep retail
costs down for customers. His agency looks at customer interests in rate
cases and other utility matters for investor-owned utilities, which
include Duke but not the state-owned Santee Cooper.
Duke Energy spokeswoman Paige Sheehan declined comment Thursday, but
Santee Cooper spokeswoman Laura Varn said her utility's board will
discuss its agreement with Central Electric at a meeting Monday. The
board also will hear a staff report it requested that reviews Santee
Cooper's future energy needs, she said.
Santee Cooper has said it needs at least one additional 660-megawatt
power plant to meet future demands. It has picked a site near Pamplico
and Kingsburg in Florence County. The utility now supplies much of its
power to electric cooperatives, which pass the energy along to customers
in rural and suburban areas.
Duke Energy, the Carolinas' largest power company, is discussing the
sale of more than 1,000 megawatts to South Carolina electric
cooperatives, Scott said.
Ann Timberlake, director of the Conservation Voters of South Carolina,
said cooperatives are doing the right thing in discussing a purchase of
energy from Duke.
"This is very exciting news and confirms some things we've been hearing
for a while,'' Timberlake said. "It's hard for them to justify to their
customers the risky investment in coal if there is a viable option.''
It's unclear what energy source Duke would use to supply power to the
cooperatives, but the company has two nuclear plants near Charlotte and
is building a coal-fired plant nearby.
In many states, plans to build coal-fired power stations have been
scrapped because of the environmental consequences associated with
burning fossil fuels. Buying from Duke would allow South Carolina to
avoid the problems of dealing with potentially harmful air pollution
from the proposed Pee Dee plant.
Environmentalists have waged a steady campaign against the plant during
the past two years and have challenged state permits for the plant in
court.
For the past year, Santee Cooper's board has been discussing its
contract with Central Electric to supply power to cooperatives, Varn
said. But Varn said the discussions have occurred behind closed doors
and she was not privy to details.
Officials with Central Electric Cooperative, which represents the
state's 20 individual cooperatives, declined comment Thursday.
Bob Paulling, director of the Tri-County Electric Cooperative in St.
Matthews, cautioned that the Duke power sale has a number of hurdles to
clear.
"A lot of things could derail it fairly easily,'' he said. "It's
legitimate negotiating going on, but nothing is finalized.''
Reach Fretwell at (803) 771-8537. Reach Monk at (803) 771-8344.
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