Kansas coal a "financial loser"

May 30, 2013 | By Barbara Vergetis Lundin

The D.C. Circuit Court has dismissed an appeal by Sunflower Electric of a ruling requiring environmental review of Sunflower's proposed coal plant in Holcomb, Kansas.

Colorado's Castle Gate coal plant. Credit: Staplegunther/Wikimedia Commons

The decision lets stand a district court ruling that the U.S. government violated the law by allowing Sunflower to proceed without first examining its environmental effects and alternative actions. Ultimately, greater environmental review and consideration of alternatives such as conservation and renewable energy is required.

New clean air and public health standards adopted since the project was first proposed will make it difficult for the expansion plant to secure financial backing, given lack of demand for additional coal-fired electricity generation in the region. Sunflower Electric struggles financially from overbuilding capacity at its Holcomb I facility. The Sierra Club contends that history could repeat itself if Holcomb II is constructed, since Sunflower has not demonstrated the need for the project.

"Coal in Holcomb is already a proven financial loser," said Sunil Bector, an attorney with the Sierra Club. "Given Sunflower's massive debt and precarious financial situation, it can't possibly finance this new coal plant without putting ratepayers and American taxpayers at further risk."

Sunflower Electric remains hundreds of millions of dollars in debt to the federal government for taxpayer-supported loans taken out to build the existing coal plant at Holcomb Station, Bector added.

If built, the plant would provide power to Colorado-based utility Tri-State Generation and Transmission Association. The Sierra Club contends that according to Tri-State's 2012 resource plan filed with the Colorado Public Utilities Commission, the utility is unlikely to need any power from the new plant, making it an unnecessary and a risky investment.

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