Sierra Club does a deal to kill Ben Hill coal project

The Sierra Club said April 10 that Power4Georgians, made up of electric membership cooperatives in Georgia, has agreed to cancel the proposed Ben Hill coal-fired power plant.

Power4Georgians also agreed to comply with new safeguards against mercury pollution and invest $5m in energy efficiency and renewable projects, the club said.

The Sierra Club, the Fall Line Alliance for a Clean Environment (FACE), Southern Alliance for Clean Energy (SACE), and the Ogeechee Riverkeeper, represented by the Southern Environmental Law Center and GreenLaw, successfully challenged a permit for another Power4Georgians coal plant, Washington, that had been issued by the Georgia Department of Environmental Protection.

The settlement agreement is pending approval by each group, the club added. If built, the Washington plant, which is nearly identical to Ben Hill, will have to meet more protective emission standards for mercury and other air toxins. Ben Hill and Washington are both supercritical pulverized coal plants with a capacity of about 850 MW each.

Power4Georgians official Dean Alford told GenerationHub on April 10 that the deal calls for Ben Hill to be cancelled, but clears away remaining permit problems for Washington. If the settlement is put into final form, Washington should be in construction fairly soon, he added. “We’re working full speed ahead” on the Washington project, he added.

Washington now faces its steepest challenge yet, as the U.S. Environmental Protection Agency recently announced a carbon pollution rule for new coal-fired power plants, which will require new coal plants to emit no more than a conventional gas-fired plant, the club added. Power4Georgians had not considered carbon capture technology in the original Washington proposal. In the rule, EPA identified Washington as a potential “transitional” source whereby it could be exempt from the rule if there is a final permit and construction commences within a year of when the rule is published, the club noted. The carbon pollution rule is expected to be published later in April. Alford said Power4Georgians is confident it can get shovels in the ground within that one-year deadline.

“Plant Washington continues to lack a complete and legally effective permit that authorizes construction, and it won’t have one until the mercury permit amendment is issued, which will take another 30 days at least,” said Kurt Ebersbach, staff attorney with the Southern Environmental Law Center. “Based on filings by Power4Georgians in this case, it is clear that they have not done engineering, selected the boilers, lined up investors, or met any of the criteria that EPA is looking at to exempt a new source from complying with the carbon pollution rule.”

Power4Georgians is a consortium of four remaining electric membership cooperatives in Georgia, after six other cooperatives left the consortium citing cost concerns. Cobb EMC, the largest and most prominent investor in Power4 Georgians, withdrew funding and support for the consortium and the Washington proposal in January.

The cancellation of Ben Hill marks 168 total coal plant proposals cancelled across the U.S. due to changing market conditions, legal challenges and local opposition, said the club. In December 2011, New Jersey-based LS Power cancelled the proposed Longleaf coal project in Georgia. Further, 106 coal plants have been scheduled for retirement, including two units at the Branch plant that were recently approved by the Georgia Public Service Commission in a case pursued by the Georgia Power unit of Southern Co. (NYSE: SO).

The construction of Washington is critical to the member EMCs, as it will help partially replace thousands of megawatts of power contracts that will be expiring over the next few years, said an April 10 Power4Georgians statement. Also, the plant will be increasingly important to the state’s overall power supply as hundreds of megawatts of existing capacity that will be taken offline to comply with new EPA emissions rules.

During the construction phase, the plant is expected to take about four years to build. It will create up to 1,600 professional construction and skilled trade jobs and generate more than $250m in total labor wages and benefits. Once completed, Washington is expected to create between 120 and 130 new full-time jobs onsite paying over $7m in wages and benefits – plus an additional 200 to 300 new secondary jobs in supporting businesses and industries, Power4Georgians noted.

Said the Power4Georgians website about why these coal projects are needed: “Although Oglethorpe Power Corporation (OPC) provides baseload generation for 38 EMCs across Georgia, most also buy supplemental power from wholesalers to ensure reliable and affordable power to meet demand. By 2013, many of these supplemental power contracts will expire. When combined with our forecasted growth, wholesalers are expected to charge substantially higher prices for contracts that are renewed. Most contracts will not be renewed because some contracts have been sold to other companies and renewal terms are unfavorable for members of the respective EMCs. Therefore, the EMCs are seeking ways to develop reliable sources of power at affordable prices.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.