Sierra Club puts pressure on Oklahoma utility to get beyond coal

The Sierra Club said May 17 that it sent a message to Oklahoma Gas and Electric that it is time to move Oklahoma beyond coal and that the retrofitting of old coal plants with new emissions controls is not the right direction to go in.

On the morning of the May 17 annual OGE Energy Corp. (NYSE: OGE) shareholders meeting, the Sierra Club commissioned a plane to fly over downtown Oklahoma City with a banner reading “OG&E – Move Beyond Coal.” OG&E operates two coal plants that lack modern pollution controls, pump harmful emissions into Oklahoma’s air and prevent the state from moving boldly to clean energy solutions, the Sierra Club claimed.

“We are calling on OG&E today to make a strong commitment for the health and economy of Oklahoma: move beyond coal,” said Whitney Pearson, Organizer for the Beyond Coal Campaign. “Public Service Company of Oklahoma made a commitment to retire the Northeastern coal plant just last month in order to cut their air pollution. OG&E is considering right now whether to install pollution controls that will keep us chained to dirty coal power for decades, or whether to follow PSO’s lead and retire the oldest, dirtiest coal plants in the state. We think the right choice is clear.”

PSO, a unit of American Electric Power (NYSE: AEP), said April 24 that it has agreed in principle with the U.S. Environmental Protection Agency, the state of Oklahoma and the Sierra Club on a framework for PSO to comply with EPA regulations affecting PSO’s two coal units at its Northeastern plant in Oologah, Okla. Under this deal, PSO would meet specified emissions rates at both Northeastern coal units, install certain emissions control equipment on one of the Northeastern coal units in 2015, and retire the other unit in 2016. The coal unit with the added emissions controls would be retired in the 2025-2026 timeframe.

According to a recent report from the American Wind Energy Association, more than 2,000 MW of wind power are online in Oklahoma, with more than 15,000 MW of wind projects waiting to be built and brought online, the Sierra Club said in its May 17 statement. Long-term prices for wind power are predictable, low, and stable, unlike fossil fuels, it added.

“Wind power today is cost-competitive with coal and gas,” said David Ocamb, Director of the Oklahoma Chapter of the Sierra Club. “Fortune favors the bold. Now is the time for OG&E to show bold leadership and move beyond coal by making a major investment in wind energy.”

The Sierra Club said it is working this summer to highlight the frequency and impact of high-ozone, or high-smog, pollution days in Tulsa and Oklahoma City. On May 17, the website will be launched with information on smog’s impacts.

OGE Energy issued a May 17 statement about the shareholders meeting and remarks made at it by Chairman and CEO Pete Delaney, but didn’t mention the Sierra Club flyover stunt. While the region lately saw blizzards, tornados, record-breaking heat and drought, which challenged OGE’s employees and equipment, the company met record demand for electricity and gathered more natural gas than ever before, the company statement said.

At OG&E, major recent investments include a nearly 600-mile expansion of the electric transmission system, smart technology with nearly 700,000 new meters installed so far, and wind power, which now accounts for more than 10% of total generating capacity, the company noted.

Utility plans emissions projects that would save coal units

OG&E is moving forward with plans for low-NOx burners, dry sorbent injection and activated carbon injection systems on several coal units, which are needed to comply with clean-air rules, said Delaney during a May 3 earnings call. This compliance plan will require approximately $450m to be invested by the year 2017, Delaney added. The timing of these projects, though, is dependent on ultimate resolution of various legal proceedings.

If no changes are granted by the courts associated with current appeals, OG&E will have until May 2013 to be in compliance with the Cross-State Air Pollution Rule (CSAPR), he said. The U.S. Environmental Protection Agency’s new Mercury and Air Toxics Standards (MATS) rule requires compliance in three years with a possible one-year extension, Delaney said. Activated carbon injection and dry sorbent injection on a limited basis are expected to allow the utility to comply with MATS, he said during the earnings call. The focus of clean-air planning is on the Sooner and Muskogee coal plants.

OGE Energy said in its May 3 Form 10-Q filing about latest developments with a regional haze state implementation plan (SIP) prepared by the state of Oklahoma: “On December 28, 2011, the EPA rejected portions of the Oklahoma SIP and issued a Federal implementation plan. While the EPA accepted Oklahoma’s [best available retrofit technology] determination for NOX in the SIP, it rejected the SO2 BART determination with respect to the four coal-fired units at the Sooner and Muskogee generating stations. In its place, the EPA is requiring that OG&E meet an SO2 emission rate of 0.06 pounds per MMBtu within five years. OG&E could meet the proposed standard by either installing and operating Dry Scrubbers or fuel switching at the four affected units. OG&E estimates that installing Dry Scrubbers on these units would include capital costs to OG&E of more than $1.0 billion.”

OG&E and the state of Oklahoma filed an administrative stay request related to the regional haze rule with the EPA on Feb. 24. OG&E and other parties also filed a petition for review of this determination in the U.S. Court of Appeals for the Tenth Circuit on Feb. 24. OG&E filed a stay request in the U.S. Court of Appeals for the Tenth Circuit on April 4.

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.