Southwestern Electric Power and Arkansas Electric Cooperative told the Arkansas Public Service Commission on Nov. 21 that the EPA’s proposed Clean Power Plan, since it is only a proposal, should have no effect on their ongoing program to install new air controls on the coal-fired Flint Creek power plant.
Earlier in November, the Sierra Club filed a motion with the commission for an order directing the independent monitor (IM) for the Flint Creek retrofit project, which had been approved by the PSC in 2013, to evaluate the EPA’s proposed carbon emissions regulations for existing electric generating units. The motion noted that the IM is charged with filing reports in this docket addressing, among other things, “[c]hanges in state or federal rules or regulations affecting the project.”
Said the plant co-owners in their Nov. 21 response: “The motion should be denied. It should be noted at the outset that EPA’s proposed carbon emissions regulations will have no effect on the ‘project.’ The Flint Creek environmental retrofit project involves the installation of a Dry Flue Gas Desulfurization system with an integrated bag house; low NOx burners and overfire air; and an activated carbon injection system. Collectively, these controls comprise the ‘project.’ While Sierra Club erroneously speculates that EPA’s carbon emission standards could affect the Flint Creek plant’s ‘continued economic viability,’ it is beyond the IM’s charge to address that issue.
“In addition, the EPA’s proposed carbon emissions regulations are not final. There is no deadline for finalizing the proposed regulations, although EPA has set a goal of finalizing the regulations by June 1, 2015. The public comment period on the proposed regulations remains open. AEP/SWEPCO and many others will be filing comments that address the legal shortcomings and technical deficiencies of the proposed regulations. If taken into account, these comments will result in significant changes to the proposed regulations. Furthermore, even after EPA adopts its final regulations, they will not establish any binding obligations for regulated sources. Instead, as provided under the Clean Air Act, the states will be given time and flexibility to formulate state plans that take into account state-specific and source-specific circumstances. For these reasons, any analysis by the IM would be premature and would amount to little more than speculation.
“On the other hand, a key driver of the Flint Creek environmental retrofit project is an EPA regulation that is final, and has a firm compliance deadline, which has already been extended for one year by the state environmental regulator. The environmental controls being installed at Flint Creek are designed to meet the requirements of EPA’s Mercury and Air Toxics (‘MATS’) rule. Compliance must be achieved by April 16, 2016 if the plant is to continue operating. Undisputed evidence at the hearing in this docket established that shutting down Flint Creek would result in serious reliability risks in Northwest Arkansas. Contrary to Sierra Club’s assertion, SWEPCO has not ‘only recently begun committing substantial resources to the project, leaving time for a more prudent alternatives analysis.’ The project is now more than 50% complete, and construction must remain on schedule if SWEPCO is to achieve compliance by the extended MATS compliance deadline.”
The one-unit plant has a 528-MW (net) capacity and is co-owned by SWEPCO, which is a subsidiary of American Electric Power (NYSE: AEP), and Arkansas Electric Cooperative.