Early Closure of Oregon’s Only Coal-Fired Power Plant Has National Implications

Utility Proposes Shutdown in 2020

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Oregon utility Portland General Electric (PGE) is maneuvering to shut down the state’s only coal-fired power plant in 2020, two decades ahead of schedule. It’s a significant move that some observers say may prompt a shift in U.S. coal use. 

"It could be game-changing," said Jeff Bissonnette, the organizing director for the Portland-based Citizens’ Utility Board of Oregon, a ratepayer advocacy group.

Bissonnette told SolveClimate that he believes this is the first time a utility in the United States has seriously undertaken a discussion to shutter a baseload coal plant.

In 2009, plans for 26 new coal-fired power plants were shelved nationwide, according to the Sierra Club. A few utilities also considered closing operational coal plants, but most are "very old coal plants" that do not operate frequently, Bissonnette said.

"On a national level, this is a very big deal," he added. "Closing down a coal plant like Boardman, a baseload workhorse of a plant that produces electricity reliably around the clock, is new."

PGE proposed the 2020 shutdown in a letter to the Oregon Public Utility Commission (PUC) on Jan. 14.

"Frankly, we were surprised at the strength of the letter," Bissonnette said.

Just four months ago, the landscape in Oregon was markedly different. In November, the utility submitted its controversial Integrated Resource Plan (IRP) to the PUC, proposing to keep PGE’s 550-megawatt, 35-year-old Boardman coal plant in business until 2040.

But there was a hitch. The utility would have to spend around $550 million on pollution control equipment to meet federal and state haze-reduction rules. Under a plan approved by the state Environmental Quality Commission, PGE would need to install the expensive controls in three shots — in 2011, 2014 and 2017.

That set off a firestorm among anti-coal activists.

With coal in trouble due to uncertainty from coming federal carbon curbs and the scientific consensus surrounding global warming, investing such sums in fossil fuels would incur too much financial risk, they argued.

For environmentalists and others, shoveling hundreds of millions of dollars into cleaner energy would be a far safer bet.

Further, the controls proposed for Boardman would do little to reign in CO2 emissions from the plant — the largest single source of greenhouse gas pollution in the state. The facility spews nearly 500 million tons of CO2, equal to the emissions from 844,000 cars per year, according to figures from Environment Oregon.

In its letter to the PUC, PGE said it was the "discussion with environmental regulators and other stakeholders" that swayed it to propose early retirement for Boardman.

“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,” PGE President and CEO Jim Piro said in explaining the letter.

“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.”

For several local environmental groups, however, PGE’s new proposal for Boardman doesn’t move fast enough.

"Based on the analyses I’ve seen, 2014 is both the most cost-effective and technically feasible year to shutdown the coal plant," Brock Howell, state policy advocate for Environment Oregon, told SolveClimate.

Howell said PGE is proposing to regulators that it purchase just $45 million in
pollution-control technology, rather than $550 million, and shut down in 2020. However, he said, other factors could prove the plant must be retired before 2020. These include the U.S. EPA’s stricter regulations for ozone and sulfur dioxide emissions and the possibility of federal greenhouse gas regulation.

"PGE and the PUC will need to assess how these new regulations will affect the Boardman coal plant," he said.

Cesia Kearns, the regional representative for the Sierra Club, the group behind the Beyond Coal Campaign for Oregon, told SolveClimate that PGE’s own figures show that closing Boardman by 2014 is the cheapest option available for ratepayers and shareholders.

"The impact on ratepayers for this scenario is negligible, and the health and environmental benefits are obvious," she said. "If PGE puts those controls on and the plant has to shut down shortly thereafter, then that leaves Oregonians with those costs."

For Citizens’ Utility Board, the fact that 2040 is finally off the table is key. "We’re now talking about a very narrow time span, rather than, ‘do we keep it open through 2040 or not’," Bissonnette said.


Next Up: Coal’s Replacement

PGE has said it will spend the next 60 days engaging with the state’s environmental groups and other stakeholders to firm up a final proposal.

The state Environmental Quality Commission and the U.S. EPA will have to approve the plans.

Discussion over what will replace the massive coal plant is expected to become prevalent. Right now, it’s "all over the map," said Bissonnette.

The most likely option is to replace many of the megawatts with natural gas. Energy efficiency is also likely to play a key role, as it seen as the most cost-effective energy investment, while biomass is also on the table.

"A significant investment in weatherization and energy efficiency, rooftop and large-scale solar, and wind farms and tidal power" would assure a climate-friendly solution for the outgoing coal, Howell said.

Advocates, utilities and others are likely to be watching the developments with interest, as coal becomes more expensive and the nation’s focus shifts to cleaner energy.

"PGE has the chance to live up to the image of wind turbines on all their maintenance vehicles and literature," said Kearns.

 

See also:

Rocky Year for Coal Industry: 26 Power Plant Plans Shelved in 2009

Sierra Club Chalks Up 100th Victory in Fight to Stop New Coal-Fired Power Plants

Clean Air Act Trips Up Sunflower’s Coal Plant Deal in Kansas

Deja Vu: A Storm Brews in Kansas over Dirty Coal

Kansas Coal Plant Back in the Bullseye