Duke Energy Indiana, a unit of Duke Energy (NYSE: DUK), was approved Aug. 14 by the Indiana Utility Regulatory Commission for a series of clean-air expenses within an environmental cost recovery case.
The case was more about ongoing expenses for already-approved projects, then any request for major new projects. Among those testifying in the case was Joseph Miller Jr., General Manager, Strategic Engineering, Duke Energy Business Services LLC.
Miller updated various Duke Energy Indiana plans. For example, he testified that in light of the company’s plan to retire the coal-fired Wabash River Units 2-5 and either retire or convert Wabash River Unit 6 to operating on natural gas in accordance with the Mercury and Air Toxics Standards (MATS), as well as the previous sale of Wabash River Unit 1 to the Wabash Valley Power Association (WVPA), the company believes it will not need to install mercury emissions monitors at Wabash River.
Miller also described the emissions benefits associated with the Gallagher coal plant baghouses. He explained that the baghouses resulted in significant decreases in emission rates of filterable particulate matter (PM), mercury, and SO2.
Miller discussed the status of the utility’s Gallagher dry sorbent injection (DSI) projects that were part of a clean-air Consent Decree reached with the U.S. Department of Justice. The company received a commission approval to install and operate the DSI system in a prior case. Miller provided the company’s 2013 annual progress report on the DSI system stating that construction and testing of both DSI systems on Units 2 and 4 were substantially complete in 2010 and that Duke Energy Indiana has been able to maintain the required sulfur limits. Miller further stated that the cost estimates of the DSI system, since the company’s 2012 progress report, remain the same and that the company is continuing to evaluate the need of whether ash fixation in the landfill is necessary as a result of operating the DSI system. He testified that the cost estimate for the required equipment remained reasonable.
Miller discussed the reasons why Duke Energy Indiana is constructing Phase 2 MATS compliance projects. He explained that the company must further reduce the mercury emissions from its generating facilities in order to comply with the MATS rule and its anticipated compliance date of April 16, 2015. He continued that the primary focus of the plan is reducing the mercury emissions at the Cayuga and Gibson coal stations.
Miller described the company’s current Phase 2 MATS compliance plan, which has not changed since commission approval. Miller testified that the estimated costs of the Phase 2 MATS compliance plan have not changed either and that the company believes that the Phase 2 projects will be completed on time and within the approved cost estimate.
Miller noted that since the approval of the Phase 2 MATS compliance plan, the General Works Contract for the Cayuga selective catalytic reduction (SCR) construction was signed, the majority of the foundation work had been completed, and the SCR ductwork and structural steel fabrication had begun. He explained that 21 of 22 major contracts for the Cayuga SCR projects and 3 of 6 major contracts for the Cayuga sorbent projects have been signed, with approximately $124m in contracts going to Indiana-based contractors, and that site mobilization was expected to begin in May 2013. He stated that no construction activities were underway yet at Gibson Station.
Major new air projects were approved back in April
The Indiana commission on April 3 approved the Phase 2 environmental compliance plan for Duke Energy Indiana that includes both coal unit retrofits and retirements.
“Petitioner proposed its Phase 2 environmental compliance plan primarily based on known requirements for complying with the Utility Mercury and Air Toxics Standards (‘MATS’),” the commission noted its April 3 approval order. “Petitioner revised its original Phase 2 Compliance Plan in rebuttal testimony to defer investment in activated carbon injection (‘ACI’) systems at its Gibson Station Units 1 through 4 and Gallagher Station Units 2 and 4, pending additional testing and emissions monitoring.”
This plan covers:
- Cayuga Unit 1 – Selective catalytic reduction (SCR), dry sorbent injection (DSI), ACI, arsenic mitigation system, mercury re-emission chemical injection system, in-service by December 2014;
- Cayuga Unit 2 – SCR, DSI, ACI, arsenic mitigation system, mercury re-emission chemical injection system, in-service by June 2015;
- Gibson Station Unit 1 – mercury re-emission chemical injection system, in-service by November 2014;
- Gibson Station Unit 2 – mercury re-emission chemical injection system, in-service by December 2014;
- Gibson Unit 3 – mercury re-emission chemical injection system, in-service by December 2014;
- Gibson Unit 5 – ACI, mercury re-emission chemical injection system, in-service by May 2015;
- Wabash River Units 2, 3, 4 and 5 – retirement by April 2015.