llinois coal plant owners say they've done their part

Aug 19 - Julie Wernau Chicago Tribune

 

Owners of coal- and natural gas-fired power plants in Illinois told regulators Monday that they should look to other generators to reduce the state's carbon footprint.

"A more cost-effective approach for Illinois is likely to include the voluntary (switch to natural gas) of inefficient coal plants, augmented by the competitive development of renewable energy, energy efficiency and distributed energy resources," said Barry Matchett, director of external affairs for NRG Energy.

The Illinois Commerce Commission heard from state electricity generators at the first of three hearings to discuss the state's options in anticipation of a new federal rule to regulate carbon emissions.

Dynegy, which owns 10 power plants in Illinois (nine coal and one natural gas), said $2 billion has been invested in those plants to control pollution. The U.S. Environmental Protection Agency has suggested that making coal plants more efficient could be a way to meet pending carbon pollution limits, but Dynegy said in making those upgrades, it has already made those plants as efficient as economically possible.

Those efficiencies are partially undone, however, by pollution-control equipment that lowers sulfur dioxide emissions, said Dean Ellis, managing director of regulatory affairs at Dynegy. For example, the company said turbine upgrades and efficiency projects improved power plant efficiency by 3 percent, but installing scrubbers to control sulfur dioxide lowered efficiencies by 1.8 percent because that pollution-control equipment uses energy.

"By consuming energy, they actually degrade the efficiency of the plant," Ellis said.

He said it's in the company's best interest to make its power plants as efficient as possible.

"Part of ensuring our survival is to continually improve," Ellis said.

The EPA has suggested that coal plants in the state could be 6 percent more efficient, thereby removing millions of tons of carbon dioxide pollution from the air.

But Matchett called those numbers inflated, saying not every project that could improve efficiency is plausible or economically feasible at every plant.

Matchett said NRG Energy is already doing its part to lower carbon dioxide emissions.

NRG Energy officials recently announced the company will cease coal operations at one generating unit in Romeoville, convert its Joliet plant to burn natural gas, and upgrade its two other coal plants in Pekin and Waukegan to comply with environmental regulations.

Unlike states where ratepayers pay for power generation upgrades, in Illinois, generators foot the bill for upgrades.

Another option the EPA has suggested involves running natural gas-fired power plants more frequently -- at 70 percent capacity, up from the current 29 percent. That would mean during times when coal plants run now, natural gas plants would run instead. Natural gas emits less carbon than coal, and in Illinois, the change would mean reductions of 8 million tons of carbon dioxide a year, experts said at the hearing.

But Dynegy and NRG Energy argued that obtaining the necessary supply of natural gas needed to run plants that frequently would be extremely costly, which would ultimately be borne by ratepayers through higher electricity prices.

During last winter's cold spell, demand for natural gas drove up electricity prices. While there was abundant natural gas, restrictions on pipelines made transporting gas to generators costly.

Next month, the ICC will examine renewables and energy efficiency. A final hearing is expected to address nuclear power.

EPA rules require state implementation plans to be submitted to the agency by June 2016.

jwernau@tribune.com

www.chicagotribune.com

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