Staff at the Minnesota Public Utilities Commission on May 29 filed a briefing paper ahead of a June 6 commission meeting where a new emissions-control project for the coal-fired Boswell Energy Center Unit 4 (BEC4) will be considered.
Minnesota Power, a unit of Allete (NYSE: ALE), filed for approval of this project under something called an Environmental Assessment Worksheet (EAW) under the Minnesota Mercury Emission Reduction Act (MERA), with one key commission decision being whether this project is subject to EAW review. There are certain categories of projects for which an EAW is mandatory, some that are exempt, and some where an EAW is discretionary.
“To the best of staff’s knowledge, determining the need for an EAW is an issue of first impression for the Commission,” said the briefing paper. “The Commission has ruled on three other mercury reduction plan petitions under MERA (for Sherco 1 & 2, Sherco 3, and Boswell 3) without requests for, or preparation of, an EAW.”
The statutes and rules allow for a petition by at least 100 individuals who reside or own property in Minnesota to submit a request for an EAW to the state Environmental Quality Board (EQB), as has happened in this instance. The EQB then determines whether the citizen’s petition meets the requirements of the statutes and rules, and if so, which governmental unit should make the determination on whether an EAW is required. The EQB staff has determined that the commission is the appropriate governmental unit, the briefing paper pointed out.
The Boswell Unit 4 project is described as a “multi-pollutant control” project, since it includes installation of a semi-dry flue gas desulfurization (FGD) system, a fabric filter, and a powdered activated carbon injection system.
Under the applicable statute, Minnesota Power is required to submit “one or more” alternatives to its proposed plan. Minnesota Power’s filing described two alternatives to its project: a 400-MW combined cycle natural gas plant; and part ownership of an 800-MW combined cycle natural gas plant. Minnesota Power did not evaluate a “no action” alternative, an alternative that included energy efficiency, nor renewable energy sources such as wind, solar, biomass and additional hydroelectric power, commission staff pointed out.
The primary purpose of the project is to meet the requirements of the MERA and the federal Mercury and Air Toxics Standards (MATS). In addition, the project is expected to help BEC4 comply with other promulgated or proposed federal and state environmental rules.
Environmental groups have charged in this proceeding that this project is actually a back-door life extension project for BEC4. Minnesota Power noted in this case that in its 2012 Remaining Life Depreciation Petition filed with the MPUC in April 2012, it indicated that the remaining useful life of BEC4 is 24 years beginning as of 2012. The emissions project is not expected to increase the useful life of the unit, staff noted. In 2010, the commission approved a seven-year extension of the useful life of BEC4 as part of the 2010 Remaining Life Depreciation docket based on significant work done in 2010 to the BEC4 boiler, turbine/generator, and the balance of the plant that provided ratepayers production efficiency with no additional coal use.
BEC4 was placed into service in 1980. Its boiler is a tangentially-fired steam generator that operates at over 635 MW gross capability and 585 MW net capability available as net output due to 50 MW of existing station service required to operate auxiliary equipment, the utility said in filings in this case. Several semi-dry FGD system technologies were considered for this project and in October 2012, Minnesota Power awarded the contract to Alstom. Alstom’s CDS technology will also further reduce emissions of acid gases, including HCl and trace metals, the utility said.
From 1980 to 2011, Minnesota Power burned low-mercury, low-sulfur Montana Powder River Basin (PRB) coal at BEC. Based on testing done in recent years, Minnesota Power began burning a new blend of coal from Wyoming and Montana at the plant in January 2011.