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Posted on March 13, 2009
By KAREN DILLON
The Kansas City Star

Rush for Coal Plants Slows to a Stagger

If the Sunflower Electric Power Corp. coal-fired power plants are built in Kansas - and that's still an if - they could be among the last to go up in America for quite a while.

Just a few years ago, 180 coal plants were on the drawing boards across the country. Now that number may be down by half.

"The rush to build new coal plants is on its last legs," said James Gignac, Midwest director of Sierra Club's "Move Beyond Coal" campaign. "Over 90 of the coal plants have been abandoned or defeated."

Even industry officials acknowledge that applications for new plants have slowed significantly.

"What we have seen in the past year and a half is a decrease in the numbers of proposals for new coal-fired power plants," said Dan Riedinger, a spokesman for Edison Electric Institute, which represents 70 percent of the electric power industry.

Blame the slowdown on the skyrocketing costs of building coal plants and looming federal air-quality regulations, which create uncertainty over future costs for utilities. That makes financing for new plants difficult, at best, to obtain.

Some congressional leaders have called for a ban on building them, at least temporarily.

The industry still wants to build coal plants, and about 40 are under construction, the most in several decades. But plans for building more will depend on developing new technology to remove greenhouse gas emissions, industry leaders say.

"There is no question that in order to continue to use coal in large quantities to produce electricity, we have to develop the ability to capture and store carbon dioxide emissions from coal-based electric generation," Riedinger said.

"But we are finding a lot of interest from many quarters in making sure coal sticks around."

The industry has been through slowdowns before.

Following an era of overbuilding in the 1970s and early 1980s, almost no coal plants were constructed for years. Then a flood of applications for new plants came earlier this decade. At the peak, more than 180 plants were being planned.

It is difficult to track exactly where they all stand now, but the drop-off is clear:

-In 2007, the U.S. Department of Energy listed 151 coal-fired power plants in the planning stages. About 60 of those projects were refused licenses by regulators or were abandoned, according to the agency.

-An additional 50 are being challenged in court, according to the Earth Policy Institute, which backs green issues.

-Since 2001, the Sierra Club says, at least 90 have been blocked and 60 more are being challenged.

Riedinger said 90 percent of new electricity capacity last year came from the addition of renewable energy and natural gas, a new high.

In this region, several utilities that have put new coal plants on indefinite hold include Associated Electric Cooperative, which had received approval to build one just east of Kansas City, and Westar. Both utilities cited high cost, possible regulations and the decision to invest in energy conservation and renewable energy.

Kansas City Power & Light is facing dire financial problems that the utility has not clearly defined. But a power plant it is building near Weston is applying financial pressure. The utility initially estimated the plant would cost almost $1 billion. Now overruns have doubled the price.

One effort is still moving forward - Sunflower continues its yearslong fight to build two generators in western Kansas.

The utility's applications for permits had been rejected by the state because of concerns over carbon's impact on global warming.

The state Legislature recently passed a bill that would allow the utility to build the generators, but the governor is expected to veto it.

Though Sunflower officials have not yet found financing, they say their studies show coal is the lowest-cost fuel source.

For the foreseeable future, the biggest obstacle to building coal plants is likely to be federal carbon regulations.

President Barack Obama has called for Congress to draft legislation to limit carbon emissions, and the Environmental Protection Agency is moving ahead with regulations.

While utilities have backed off building coal plants for now, they haven't given up on coal.

"Coal is part of the future," Riedinger said. "But there has to be a solution to carbon dioxide pollution."

The industry has asked Congress to provide $1 billion a year for the next 20 years to develop technology that would capture carbon from coal and sequester it in caverns.

In the short term, utilities are greatly increasing their arsenal of renewable energy and gas-fired power plants. Then, Riedinger said, the industry will increase the use of nuclear energy.

By 2030, if the carbon-capture technology works, utilities will again be building coal plants. But some in the industry think coal plant construction needs to continue or the money for the technology will dry up.

"In order to bring the technology to the marketplace, you have to show there is a robust market for that technology," said Joe Lucas, a senior vice president for the American Coalition for Clean Coal Electricity.

His group is running a multimillion-dollar campaign pushing "clean coal" technology. The campaign's commercials have sparked a counter campaign that lampoons the notion of clean coal.

For now, the building boom has slowed way down. The Kansas plants, if approved, could be on the tail end, said Nancy Jackson of the Climate and Energy Project, a Lawrence nonprofit pushing to reduce greenhouse gases.

"If anybody is going to build the last traditional coal plant in the country," she said, "the most likely place they can get that deal done is in Kansas."

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