Gulf Power nears Florida PSC decision on Daniel emissions projects

The Florida Public Service Commission staff on Oct. 11, ahead of an Oct. 24 commission meeting on the matter, recommended approval of an application by Gulf Power to add bromine and activated carbon injection systems on the coal-fired Plant Daniel in Mississippi.

On April 1, Gulf Power filed a petition requesting that the commission approve Gulf’s inclusion of the Plant Daniel bromine and ACI project, Plant Crist transmission upgrades, and the Plant Smith transmission upgrades, and approve recovery of these costs through the Environmental Cost Recovery Clause (ECRC). The transmission upgrades were later separated out of this case. Daniel is 50-50 owned by Gulf Power and Mississippi Power, which are both units of Southern Co. ( NYSE: SO).

“Based on Gulf’s filing and responses to data requests, staff recommends that the proposed Bromine and ACI project will be needed for Gulf to comply with environmental regulations,” said the Oct. 11 staff recommendation.

In February 2012, the U.S. Environmental Protection Agency issued the Mercury and Air Toxics Standards (MATS). The MATS rule imposes emissions limits for mercury, acid gases and particulate matter on coal and oil-fired electric utility generating units. Gulf’s Plant Daniel units 1 and 2 are subject to MATS requirements. The MATS mercury emission limit that Plant Daniel will have to meet is 1.2 lbs/TBtu (pounds/trillion Btu).

Compliance for existing sources is required by April 16, 2015, with provisions for one- and two-year extensions under limited circumstances.

Based on Daniel emissions data, as well as data from similar units, mercury emissions at the plant are estimated at 6-8 lbs/TBtu. During 2010, the company determined that, at a minimum, Plant Daniel units 1 and 2 would require the installation of SO2 scrubbers in order to comply with certain environmental regulations. The Daniel scrubbers were approved for cost recovery through the ECRC by the commission in 2010. The scrubber projects are currently scheduled for completion in 2015. Gulf said the scrubbers will allow Daniel to achieve compliance with the particulate matter limit in MATS. However, other environmental controls are necessary to achieve compliance with the mercury limits.

Gulf concluded that bromine and ACI, in conjunction with the scrubbers, rather than more capital intensive controls such as baghouses with ACI, will be sufficient to comply with MATS rules. The capital cost of the bromine and ACI project is projected to be approximately $135m less than the baghouse installation cost.

Bromine would be added to the coal supply, which would cause mercury to be oxidized after combustion, which would then be collected in the scrubbers. The ACI system is based on injecting powdered activated carbon into the duct work where it mixes with flue gas to absorb elemental mercury which is then captured in the precipitator.

Engineering, procurement, and construction of the Plant Daniel bromine and ACI systems are scheduled to begin in January 2014. Both injection systems will be placed in-service with the scrubbers during the fourth quarter of 2015. The planned addition of the scrubber plus the bromine injection and activated carbon injection are expected to reduce mercury emissions by up to 90%, allowing Gulf to operate the Plant Daniel units in compliance with the MATS rule.

Gulf Power’s ownership interest at Daniel is associated with two coal-fired units that have a nameplate rating of 548.25 MW each. The plant is operated by Mississippi Power. The facility is located just north of Pascagoula, Miss., with direct transmission access across Alabama and into Florida. Both coal-fired units were affected by the Acid Rain Program and have operated on low-sulfur coals since the 1990s.

U.S. Energy Information Administration data shows that Daniel (known by its full name as Victor J. Daniel Jr.) took coal earlier this year from Peabody Energy‘s (NYSE: BTU) Foidel Creek deep mine in Colorado.

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.