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Thursday, January 14, 2010

PGE Takes Step Towards Closing Oregon's Only Coal Plant

Oregon's largest utility, Portland General Electric (PGE), announced it's moving forward on a plan to stop burning coal at the state's only operating coal plant. The investor-owned utility, which serves Portland, much of the surrounding metropolitan area, and the state's capitol, Salem, informed the Oregon Public Utility Commission (OPUC) that it intends to pursue a plant that would either shut down the 550 megawatt coal-fired Boardman Plant or completely switch fuel sources by 2020.

According to a company press release, PGE submitted its most recent integrated resource plan (IRP) to the OPUC in November, proposing to install extensive emissions control retrofits on the Boardman Plant, at an estimated cost of $520 million to $560 million. These controls would allow the plant, located in northeastern Oregon along the Columbia River, to continue to operate despite new, stricter emissions rules from the state Environmental Quality Commission (EQC).

“Our preliminary analysis shows that an alternative plan may be the best option for our customers and we intend to pursue that,” said Jim Piro, PGE's President and CEO. “We need to complete our analysis and determine whether we have enough support to move forward, but we feel it’s important to let people know that this is our preferred path.”

According to PGE:

The company chose not to include a proposal in its IRP to cease Boardman operations in 2020 because such a plan would not be actionable under the EQC rules; however, further discussion with environmental regulators and other stakeholders suggests that there may be support for a rule change.

“Right now state regulations give us very few options – either shut the plant prematurely at a tremendous cost to customers or install very expensive new controls despite uncertainty about future carbon regulation and technological developments,” Piro said. “We think an alternative plan could reduce cost and risk for our customers while giving us time to develop replacement resources or convert to a different fuel, but we’ll need changes in state rules and help from our stakeholders to accomplish that.”

Piro noted that if agreement on an alternative plan can’t be reached, PGE will continue to seek approval for installation of all required emissions controls and continued operation of the plant – the best option available to customers under current state rules.

PGE intends to work with the OPUC to establish a new schedule for review of resource planning decisions regarding the Boardman Plant.
Closure of the Boardman Plant would mark the end of coal-fired electricity generation within Oregon and the closure of the largest single source of air pollutants in the state (if not west of the Rockies). The aging coal plant was first built in the 1970s and predates the more stringent air emissions requirements of the Clean Air Act.

One commentator at notes:
According to documents filed for their Title V Permit renewal in 2006 (a five-year permit), in 2003 PGE Boardman released 5 million tons of CO2, and in a given year emits 28,000 tons of sulfur and nitrogen oxides along with hundreds of tons of particulate matter, major causes of cardiac disease, low birth weight, SIDS, lung cancer, heart attack, stroke, and asthma. Plus Boardman annually emits enough mercury (221 lbs.) to contaminate 2.6 million acres of water, or four times the surface area of all Oregon lakes.
However, Boardman's closure would not be the end of Oregon's dependence on coal.

While most Oregon residents assume their electricity comes predominantly from the famous hydroelectric dams on the Columbia River and the region's other mighty waterways, coal actually provides just shy of 40% of the state's electricity supply as of 2007, and is the second largest power source after hydropower. While most of the state's publicly-owned utilities receive their power from the federal hydropower system managed by the Bonneville Power Administration, the state's two big investor-owned utilities have largely been barred from accessing BPA's hydropower since the 1970s and now get a big slug of their power from coal.

PGE currently relies on coal for 38.9% of it's electricity supply, while Pacific Power, the state's other major utility (parent company PacifiCorp) relies on coal for over two-thirds of the electricity they supply to customers throughout the state. Both utilities import electricity from coal-fired power plants located in the intermountain region, including Montana, Utah and Wyoming.

The Ted Sickinger has more on the potential Boardman closure at the Oregonian here.

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