Heading for a Nov. 7 technical hearing on the issue, Idaho Power on Nov. 4 filed with the Idaho Public Utilities Commission a rebuttal of arguments against its plan to install selective catalytic reduction (SCR) on the coal-fired Jim Bridger Units 3 and 4.
Idaho Power, a unit of IDACORP (NYSE: IDA), owns one third of the Jim Bridger plant in Wyoming and the adjacent coal mining operations, while PacifiCorp owns the other two thirds of each. Due to regional haze mandates from the U.S. Environmental Protection Agency, the plant co-owners plan to install SCR for NOX control on Units 3 and 4.
Idaho Power on June 28 sought Idaho commission approval for its share of the SCR expenses. The review schedule includes the Nov. 7 technical hearing and a Nov. 25 public hearing.
Utility official Tom Harvey on Nov. 5 responded to comments on that plan from parties like Industrial Customers of Idaho Power, the Snake River Alliance and the Idaho Conservation League.
Some parties have tried to suggest that future uncertainties about other regulatory programs outside of regional haze means these SCRs should not be built. “Yes, the Company agrees that coal-regulation uncertainty exists, but its recommendation to install the SCRs was made based upon what is known today and what can be reasonably foreseen or modeled,” Harvey wrote. “Waiting for perfect knowledge before taking action is not an option that will ensure reliable service to customers.”
Harvey noted that eight of the nine sensitivities in its Coal Study identified the SCR investments as being the lowest present value cost alternative. It is only under the unlikely event that a low gas price future is coupled with a high carbon adder future that the SCR investments would result in a higher present value cost than replacing Jim Bridger Units 3 and 4 with a Combined Cycle Combustion Turbine (CCCT).
What the company knew at the time it filed the application was that the EPA proposed approving sections of the Wyoming State Implementation Plan (SIP), including the parts pertaining to the SCRs at Jim Bridger Units 3 and 4, which will make compliance with the Wyoming SIP by the stated deadlines federally enforceable. As the future of carbon regulation is not known, the company included a “carbon adder” in its Coal Study that represents those future costs of regulation that are not currently known but assumed to occur in some fashion in the future. This is the same carbon adder that was used in the company’s 2013 integrated resource plan (IRP), which is intended to capture future unknown costs associated with carbon regulation.
The Jim Bridger plant consists of four units and is the “workhorse” of ldaho Power’s thermal fleet. After adjustment for scheduled maintenance periods and estimated forced outages, the annual energy generating capability of ldaho Power’s share of Jim Bridger is about 625 MW average. Of ldaho Power’s entire thermal generation fleet, it has the lowest dispatch cost and the lowest installed cost of nameplate capacity to operate.
Idaho Power is requesting that the commission issue a certificate of public convenience and necessity (CPCN) authorizing it to invest in and construct SCR systems and associated ancillary equipment for Jim Bridger Units 3 and 4. Each SCR system would be comprised of:
- two separate universal reactors, with multiple catalyst levels;
- inlet and outlet ductwork;
- a shared ammonia reagent system;
- an economizer upgrade;
- structural reinforcement of the boiler and flue gas path ductwork and equipment; and
- extension of the existing plant distributed control system.
An induced draft fan upgrade and an associated auxiliary power system variable frequency drive insertion are required on Unit 4 only.
A Best Available Retrofit Technology (BART) appeal settlement deal with the state of Wyoming, and also the Wyoming Regional Haze SIP, require the installation of SCR on Unit 3 by the end of 2015 and on Unit 4 by the end of 2016. On May 23, EPA recommended approval of the Wyoming Regional Haze SIP for installation of SCR on Jim Bridger Units 3 and 4.
SCRs for Jim Bridger Units 1 and 2 are in the longer-term plans, for the 2019-2020 period.