HECA wins six-month suspension of state reviewJul 7 - McClatchy-Tribune Content Agency, LLC - John Cox The Bakersfield CalifornianHydrogen Energy California has won a regulatory timeout, giving its developer six months to close a key business deal or face termination of the controversial, $4 billion chemical and power plant proposed in western Kern County. Rather than halt a long-running government review of the coal-fired plant, as project opponents had requested, a committee of the California Energy Commission approved the company's petition for a suspension Friday, saying Massachusetts-based developer SCS Energy LLC had tried diligently to overcome obstacles. The timeout came with a series of conditions including providing documentation by, the end of the suspension period that began Monday, that it has reached agreement to bury its byproduct carbon dioxide "at a site that is both feasible and available for such use." SCS has said its inability to secure final agreement on such a deal has been the primary challenge holding up the 200-employee project. Among other conditions, the company also must respond in detail to Kern County's concerns that HECA would produce chemicals barred by the project's agricultural zoning. The committee said in a written filing that failure to comply with this condition in particular is grounds for possible termination of the project. The Sierra Club, one of several groups opposed to the project, said it welcomed the new conditions, even as it voiced concern that halting the project altogether would have been better for HECA's neighbors near Tupman. "Without a formal termination, it will remain a serious source of anxiety and uncertainty for the community," Sierra Club spokesman Evan Gillespie said by email. HECA did not respond to a request for comment Monday. SCS has been working with the commission to secure HECA's approval since 2009, after buying the project from BP, the international petroleum producer, and mining giant Rio Tinto. Originally, SCS was planning to sell HECA's carbon dioxide to Occidental of Elk Hills, which hoped to use the soda gas to enhance its nearby oil production. But Oxy's move last year to spin off its California operations annulled any agreement between the companies, leaving SCS without a definite home for its carbon dioxide. The Energy Commission committee expressed concern that, if SCS cannot strike a new deal with Oxy spinoff California Resources Corp., additional project delays could be in store. "If a new location is to be used, full environmental analysis of that site will have to be performed," the committee said in its filing Friday. "Such analysis will likely add significant amounts of time to the already unusually long review process in this case." HECA proposes to convert coal and petroleum coke into chemicals for sale and generate electricity for sale to the power grid during times of peak demand. Its design work is supported in part by $408 million in federal subsidies aimed at demonstrating the commercial viability of "sequestering" coal-derived carbon emissions underground. Project neighbors oppose the plan for reasons including its use of coal and volatile chemicals, reliance on local groundwater and expected emissions of pollution. http://www.energycentral.com/functional/news/news_detail.cfm?did=36693131 |