LMU proposed powerplant and the US EPA proposed carbon rule impact on coal plants

Posted by Laura Arnold  /   August 01, 2014  /   Posted in Duke Energy  /   No Comments


July 31, 2014

Locals: EPA delay request too late

Lt. governor calls for postponement of EPA coal plant rules

by Mitchell Kirk, Staff reporter

---- — Logansport officials say while they appreciate a state executive’s request to delay new rules on coal power plants, its timing still requires pursuing a new power plant for the city.

The U.S. Environmental Protection Agency published last month its Clean Power Plan for reducing carbon dioxide emissions from existing fossil-fueled power plants. It includes goals for meeting reduction targets in 2020 and 2030.

Adhering to these new rules will require coal power plants to add technology to reduce emissions, ultimately resulting in what opponents say will be large spikes in the cost of electricity.

Indiana Lt. Gov. Sue Ellspermann cosponsored a resolution adopted by the National Association of Lieutenant Governors. It calls for a delay in implementing the Clean Power Plan to give coal power plants more time to make the upgrades.

“Governor Pence and I are concerned about the impact on both individual Hoosiers and our state’s overall economy with the projected increases in energy costs driven by the restrictions on coal fired power plants,” Ellspermann said in the press release.

“As a state with massive coal reserves and 80 percent of our electricity produced from coal, we in Indiana see these regulations as a continuation of President Obama’s ‘attack on coal’ that will ultimately cause job losses in the mining industry and in Indiana’s strong manufacturing economic base that is dependent on low-cost and reliable electricity supplies.”

The resolution was also cosponsored by the lieutenant governors of Missouri, West Virginia, Alabama South Dakota and Hawaii.

The Logansport Utility Service Board and Logansport City Council have approved a power purchase agreement with Total Concept Solutions Logansport LLC, started by Total Concept Solutions, SARL, out of France, for a proposed power plant to be developed in the city.

The privately funded project is estimated to cost about $803 million and would set an initial electric rate of 5.3 cents per kilowatt-hour until 2021, when rates would rise in accordance with the Consumer Price Index — All Urban Consumers.

That initial rate is about 2 cents per kilowatt-hour less than what Logansport Municipal Utilities got electricity for the first three months of this year from Duke Energy, which provides about 70 percent of LMU’s electricity.

The plant will start out on natural gas before taking on refuse-derived fuel.

Logansport Mayor Ted Franklin continues to negotiate the terms of a development agreement with Total Concept Solutions, which will determine how big the plant will ultimately be and set milestones for construction.

Local officials were asked if Logansport would benefit should the EPA heed the resolution’s request.

Logansport Municipal Utilities Superintendent Paul Hartman said while he appreciates what the NLGA resolution sets out to do, he feels it’s too late for it to be considered by the EPA.

“The resolution should have stopped the EPA a long time ago,” Hartman said. “The president has declared war on coal and this is the fallout.”

Franklin agreed, adding that the new EPA rules are a big part of the motivation behind the pursuit of the new plant.

“We’ve been out in front of this for years now,” Franklin said. “It’s not going to go away. The only option right now is to find an alternative or purchase electricity from a third party supplier.”

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