TEP (sort of) says goodbye to coal

August 17, 2015 | By Barbara Vergetis Lundin

Tucson Electric Power (TEP) is ending the use of coal at its largest local power plant, while others in the region are fighting an expensive battle to keep coal alive.

San Juan Generating Station. Credit: Sierra Club

The Environmental Protection Agency (EPA) accepted TEP's proposal to end the use of coal at the plant as an alternative to the installation of costly emission controls to limit regional haze.

The coal inventory at the H. Wilson Sundt Generating Station has already been depleted with the last remaining chunks pulverized and fed into the boiler of Unit 4, a multi-fuel unit that will now rely primarily on natural gas, supplemented by renewable landfill gas and a unique "solar boost" system.

TEP typically fueled Unit 4 with coal when natural gas prices were higher, reducing costs that are passed along in customers' monthly bills. While Unit 4 will lose that flexibility, it can produce 30 percent more power when fueled by natural gas.

"Eliminating the local use of coal is an important part of our plan to build a cleaner, more diverse energy portfolio," said David G. Hutchens, TEP's president and chief executive officer. "With the current low cost of natural gas, ending our use of coal at the Sundt Generating Station is a cost-effective way to improve our environmental performance while preserving the reliability of our local electric service. This step serves the best interests of our customers, our community and the environment."

TEP is ending its use of coal at the plant more than two years ahead of the Dec. 31, 2017 deadline in its agreement with the EPA. The transition also will help Pima County comply with stricter ozone standards that take effect later this year while reducing the plant's carbon dioxide emissions, contributing toward compliance with new "Clean Power Plan" rules that are designed to take effect beginning in 2022.

Meantime, unlike TEP, Public Service Co. of New Mexico (PNM) is fighting for a plan to retrofit its San Juan Generating Station (SJGS) with expensive emission controls to limit air pollution and the resulting haze -- and getting lots of pushback.

The PNM Resources subsidiary has filed a settlement agreement with the New Mexico Public Regulation Commission (NMPRC) that is based on the closure of two of the four coal-fired units at SJGS by Dec. 31, 2017, and installation of emissions control technology on the remaining units to address compliance with federal visibility regulations under the Clean Air Act. In addition, the Agreement positions New Mexico to comply with the U.S. Environmental Protection Agency's (EPA) Clean Power Plan, which imposes limits on carbon emissions.

The closure of SJGS Units 2 and 3 by Dec. 31, 2017, and the installation of the Selective Non-Catalytic Reduction (SNCR) equipment on the remaining two units would reduce water use and seven different emissions (including carbon) at SJGS by approximately 50 percent. The plan would reduce NOx emissions by more than 90 percent using state of the art controls and improve visibility by 40 percent potentially.

Even so, environmental groups argue that even after the retrofit, SJGS would still be one of New Mexico's largest sources of air pollution.

Instead of retrofitting the coal plant, the Sierra Club contends that PNM should develop a plan to retire the SJGS and offset its electricity with clean, renewable energy. They say that, based on a conservative estimate, more than 2,500 megawatts (MW) of solar and wind could be developed in the Four Corners region, including the Navajo Nation, more cheaply than coal and that the overall renewable energy potential in the Four Corners is far greater.

It's a good thing for TEP that PNM is still fighting for the SJGS retrofit, since TEP plans to keep buying power from the SJGS in New Mexico and, beginning in 2018, will be purchasing 50 percent less than it does today.

For more:
- see this background article

http://www.fierceenergy.com/story/tep-sort-says-goodbye-coal/2015-08-17