SO2 scrubber upgrade projects at the Hunter power plant in Utah are needed to meet new air emissions standards and to compensate for expected higher sulfur levels in the coal the Hunter plant burns, said PacifiCorp official Chad Teply.
On May 25, PacifiCorp affiliate Rocky Mountain Power filed rebuttal testimony from various utility executives, including Teply, at the Wyoming Public Service Commission as part of an ongoing rate case. Teply was contesting testimony by Howard Gebhart, who represents the Wyoming Industrial Energy Consumers (WIEC).
The May 25 rebuttal testimony doesn’t give Teply’s job title, but the December 2011 filing shows it as Vice President of Resource Development and Construction for PacifiCorp Energy.
The Hunter plant is a three-unit facility with a net generation capacity of about 1,320 MW. Units 1 and 2 are co-owned, while Unit 3 is 100% owned by the company. Unit 1 is 93.8% owned by the company and 6.2% owned by the Utah Municipal Power Authority. Unit 2 is 60.3% owned by the company, 24.9% owned by Deseret Generation and Transmission Cooperative, and 14.8% owned by Utah Associated Municipal Power Systems.
“The pollution control projects included in this case are required to comply with existing regulations, are the least-cost environmental compliance alternative for our customers, and were appropriately evaluated and defined considering pending coal sulfur quality changes at the Hunter facility,” wrote Teply. “With respect to the Hunter Unit 2 scrubber project, my testimony rebuts Mr. Gebhart’s recommended disallowance of project costs that were previously reviewed and subject to the language of the Stipulation and Agreement in Docket No. 20000-384-ER-10.”
Gebhart argued that the costs are excessive based on his representation of standard regulatory practice as it relates to determining cost-effectiveness and estimating emission reductions. Gebhart comes to the conclusion that the company has made “hindsight arguments” regarding the role that coal sulfur content played in the timing of development, evaluation, and permitting of the emissions controls at Hunter, Teply wrote.
“Mr. Gebhart has failed to appropriately consider key project specific planning inputs, including coal quality and existing equipment performance limitations, which must be considered when evaluating the cost effectiveness of those projects,” Teply added. “He has also mischaracterized the application of a standard regulatory practice regarding agency application of cost-effectiveness criteria, and has misrepresented the underlying requirements of the Section 309 Regional SO2 Milestone and Backstop Trading Program (‘Section 309 Program’).”
The pollution control investments presented in this case are required to comply with existing regulations including: the U.S. Environmental Protection Agency’s Regional Haze Rules; the Section 309 Program developed over a number of years in alignment with existing federal regulations and administered in Utah and Wyoming; National Ambient Air Quality Standards; New Source Review requirements; state-issued construction and operating permits; and state implementation plans (SIPs), Teply noted.
The U.S. EPA has proposed that the portion of the state of Utah’s Regional Haze SIP that includes the Hunter Units 1 and 2 scrubber projects for SO2 control be approved. The EPA’s proposed action is currently undergoing public comment, Teply noted.
Old scrubbers found to be inadequate for new air limits
In support of the Regional Haze program being administered by the state of Utah, and the associated Section 309 Program, the company completed detailed analyses of the appropriate technology to be applied to this Best Available Retrofit Technology (BART)-eligible facility to achieve established emissions control objectives. Hunter Unit 2 was previously configured with a wet scrubber with permitted SO2 emission limits of 0.21 lbs/MMBtu SO2 (or a minimum of 80% removal, whichever is more stringent). The revamped Hunter Unit 2 scrubber included in this case will result in the removal of approximately 9,200 tons of SO2 per year.
The first official submittal to the Utah Division of Air Quality regarding the Hunter Units 1 and 2 scrubber projects was provided when the notice of intent to construct the Hunter projects was submitted in August 2006. Anticipated changes in fuel quality were identified in early 2007. This timing allowed the anticipated fuel quality changes to be incorporated into the final scope of the Hunter scrubber projects. SO2 emissions reductions at Hunter 1 and 2 were required notwithstanding forecasted increases in coal sulfur content, he added.
The company submitted its initial notice of intent application to the Utah Division of Air Quality in August 2006 for pollution control equipment projects at Hunter. The application specifically proposed the installation of low NOx burners on units 1, 2, and 3; the replacement of electrostatic precipitators with fabric filter baghouses on Hunter 1 and 2; and the upgrade of existing scrubbers to greater than 90% removal of SO2. The Utah Division of Air Quality issued its Approval Order for the Hunter projects in March 2008.
There are three primary phases of the Hunter 2 scrubber project:
- scrubber vessel, recycle pumps, and reagent injection system upgrades intended to improve SO2 removal efficiency within the FGD system;
- reagent preparation system replacement intended to increase reagent preparation capacity of the system to accommodate increased coal sulfur content and to replace certain end-of-life equipment and components that were no longer operating to original design specifications or otherwise unreliable; and
- scrubber waste handling system replacement intended to increase waste handling capacity of the system to accommodate increased coal sulfur content and to replace certain end-of-life equipment and components.
Only the capital costs associated with the reagent preparation system phase of the project being placed in service during the test period are included in rate base in this case for the first time, Teply noted. The capital costs for the Hunter Unit 2 scrubber upgrades phase and scrubber waste handling system phase of the project were previously reviewed by the Wyoming commission as part of a prior docket.
Sulfur content of Utah coal projected for sharp jump
“Forecasted fuel quality changes result in almost twice the amount of sulfur being introduced into the Hunter units on an annual average basis across the 10-year planning horizon, when compared to historical averages for delivered coal sulfur content,” Teply reported. “The expectation is that individual coal seams may produce as much as three times the amount of sulfur on a spot basis, when compared to historical averages for delivered coal sulfur content. The ability to produce enough reagent to chemically react with this increased sulfur in the units’ flue gas requires larger equipment, upsized infrastructure such as piping and power distribution, and more efficient scrubber performance. … The new [scrubber] design allows the units to accept and control significantly higher sulfur content in the coal supplied, and supports the ability of the units to receive coal from the various cost competitive mines.”
Teply is referring to an overall trend where some Utah coal producers are exhausting their reserves of low-sulfur coal, meaning that an increasing amount of Utah production in future years will be mid-sulfur coal.
The Hunter units were originally equipped with electrostatic precipitators to control particulate emissions. The Unit 2 electrostatic precipitator has since been converted to a fabric filter baghouse. Unit 3 is identical in layout to Units 1 and 2 except the boiler and turbines are from different manufacturers and the unit was originally equipped with a fabric filter bag house to control particulate emissions. All three units are equipped with wet lime scrubbers to control SO2.
Coal is supplied by truck from nearby mines, including Arch Coal‘s (NYSE: ACI) Sufco and Dugout Canyon longwall mines, plus the Deer Creek longwall mine of PacifiCorp. Hunter has blending capability in its fuels preparation facility, which allows for combustion of various coal types.
Teply said in December 2011 testimony to open this case that Hunter Unit 1 scrubber rebuild construction activities began in 2011, and all phases of the Hunter 1 scrubber are scheduled to be placed in service by the end of June. Construction of the Hunter 2 reagent preparation equipment began in 2011 and was scheduled to be in service by the end of March.