Wisconsin PSC approves Edgewater 5 emissions control project

The Public Service Commission of Wisconsin issued a June 4 final written order approving Wisconsin Power and Light‘s (WP&L) July 2012 application for approval to install new emissions controls on the coal-fired Edgewater Unit 5.

WP&L had sought authority to construct a dry flue gas desulfurization (FGD) and fabric filter collection system on Unit 5 of its existing Edgewater Generating Station, located in Sheboygan County, Wisc. WP&L plans to construct the facilities for control of SO2 emissions. The estimated cost of the project is $413.7m, excluding allowance for funds used during construction (AFUDC).

WP&L, a unit of Alliant Energy (NYSE: LNT), had said May 2 that the project had gotten a verbal approval from the Wisconsin commission.

Edgewater consists of three coal-fired units; Units 3, 4 and 5. These generating units began operation in 1951, 1969, and 1985, and have nameplate generation capacities of 60 MW, 330 MW, and 380 MW, respectively. While Unit 5 was previously jointly-owned by WP&L and Wisconsin Electric Power, Units 3 and 5 are currently owned exclusively by WP&L. Unit 4 is jointly-owned by WP&L and Wisconsin Public Service Corp. (WPSC). WP&L owns 68.2% and WPSC owns 31.8% of Unit 4. All three units are operated by WP&L.

Unit 5 currently utilizes sub-bituminous Powder River Basin coal obtained by WP&L from various mines. The proposed SO2 emissions reduction project includes installation of a dry FGD and fabric filter baghouse on Unit 5.

This project is required under the terms of the final settlement that WP&L, the U.S. Environmental Protection Agency and Sierra Club have reached regarding any new air pollution source permit review or prevention of significant deterioration (PSD) violations. WP&L also told the commission that the proposed project would allow it to comply with SO2 reduction requirements, specifically those resulting from EPA’s Cross-State Air Pollution Rule (CSAPR) or its replacement.

WP&L developed a plan for reducing SO2 emissions from its fleet to meet CSAPR SO2 emissions reduction requirements through a combination of controlling emissions and unit retirements. Reducing SO2 emissions at Unit 5 is a critical component of this plan.

Controls would reduce SO2 emissions by at least 90%

The proposed project would reduce SO2 emissions from Unit 5 by at least 90%. This reduction in SO2 emissions would also reduce the formation of fine particulate matter (PM2.5) in the atmosphere. Over a 30-year period, reductions in SO2 emissions by 90% from Unit 5 would translate into the removal of over 220,000 tons of SO2 from the atmosphere compared to current emission rates.

A fabric filter baghouse is a necessary component of a dry FGD system for control of particulate matter emissions. The installation of the baghouse may provide mercury emissions reductions and will provide additional benefits by reducing hazardous air pollutants emitted by Unit 5. The dry FGD and fabric filter system is very effective at capturing fine particulate matter such as PM2.5 acid mist.

In WP&L’s integrated resource plan (IRP), Unit 5 is modeled as having the proposed project installed and operating in 2017 in Plan 1. To estimate the economic benefit or detriment of this plan, WP&L modeled alternative Plan 2, including retirement of Unit 5 at the end of 2016. EGEAS computer model runs for both Plan 1 and Plan 2 were done under the same sets of sensitivities.

The economic benefit of Plan 1 ranges from a present value revenue requirement (PVRR) of approximately $64m to $289.5m depending on the sensitivity. The only sensitivity that resulted in a detriment, or negative PVRR, included installation of the proposed project assuming low natural gas prices throughout the study period.

Results of modeling of Plan 2 under base case assumptions show the need to replace the full capacity of Unit 5 almost immediately. The EGEAS modeling indicates that this capacity would be replaced with a combination of a 300-MW jointly-owned combined-cycle unit in 2017 and a 189-MW simple-cycle combustion turbine in 2018. These results occur in 13 of the
19 sensitivities. In five of the remaining six sensitivities, the simple-cycle combustion turbine is necessary in 2017 rather than 2018.

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.