RBC I A committee of town and county officials, districts, business and private citizens plan to meet this week and discuss utilizing Grand Junction’s Natural Resources Group and EIS Solutions to take further steps to support the Deserado Mine, the Bonanza Power Plant and, more broadly, the region’s coal, oil and gas industries.
The meeting is the third in less than a month to mobilize in response to recent legal challenges by environmental group WildEarth Guardians and potential regulatory changes by the Environmental Protection Agency (EPA).
WildEarth Guardians has sued the EPA to change a Title V air quality permit for the Bonanza Power Plant with mandates to upgrade to state-of-the-art pollution controls, or best available control technology (BACT).
Deseret Power Electric Cooperative, which owns the plant, says it applied for a Title V permit, which should have been issued within 18 months but was not, in 2001. The Title V permit may now be rewritten with new emissions restrictions if the EPA also chooses to rescind a separate construction permit issued for a turbine upgrade completed in 2000.
Approximately 20 local officials from Rangely and Vernal, Utah, met in person and via conference call with Deseret Power Electric Cooperative Chief Executive Officer (CEO) Kimball Rasmussen and Moon Lake Electric Association (MLEA) General Manager and CEO Grant Earl on May 27, the morning before two EPA Title V public hearings took place in Fort Duchesne, Utah.
During the meeting, Rasmussen thanked Rangely and Vernal for mobilizing voluntarily before he outlined the events leading up to the lawsuit and Deseret’s rationale for opposing the upgrades.
“What you don’t want to have happen, because the (EPA has) taken 15 years to do the Title V, is for them to come back and say, ‘Here’s your Title V. By the way, bring all the environmental equipment to today’s standard 15 years later,’” Rasmussen said.
“(The industry) keeps finding new and more modern ways to do these things, which is great,” he said. “But they’re extremely expensive. And so the question is, can you afford to put that kind of equipment in and still keep running your plant?”
In a talking points paper distributed at the meeting, the company says the best available control requirements were in place when the plant was built, and subsequent installations of a ruggedized rotor and low-emitting burners to reduce nitrogen oxide emissions have made Bonanza one of the cleanest, but most expensive, power plants for its size and capabilities.
A faltering economy in the first decade of the plant’s existence, followed by upgrade costs, meant that original construction loans could be paid off only if the plant ran for its full life expectancy of approximately 40 years – sometime between 2030 and 2040 – without additional costs built in.
Besides the Title V permit, a second scenario that could keep Bonanza from reaching that life expectancy is if the Deserado Mine, the plant’s main supplier of coal, is prohibited from operating under a 3,000 acre, 21-million ton coal lease awarded last year to Blue Mountain Energy, the mine’s owner and a subsidiary of Deseret.
The WildEarth Guardians filed a lawsuit last month against the Bureau of Land Management and the U.S. Department of the Interior challenging, in the group’s words, the departments’ “failure to address the air quality impacts of the Bonanza power plant as well as monitoring data showing that the region is violating ozone standards.”
The Guardians’ most recent lawsuits come on the heels of petitions in recent years by a coalition of Colorado and Utah environmental and wildlife advocacy groups to classify the Uinta Basin a “non-attainment area” under the Clean Air Act. The designation, which was denied in 2008 and was re-petitioned for last January, would mandate air pollution improvements and force state and federal agencies to develop a cleanup plan.
Deseret maintains that its 100 percent scrubbed emissions, baghouse filtering systems and subsequent upgrades bring emission rates “well within acceptable ranges of other coal plants its size.”
Meanwhile, Deserado Mine has begun mining operations on the leased land. A successful suit, however, would limit the amount of coal the mine can access and shorten the number of years Bonanza will operate.
“What we would like is to make sure our plant is able to match the mine and have the whole project work more or less on the same opportunity and timescale,” Rasmussen said. “We’re actually one of the very few cooperatives across the country that owns and operates the mine resource and the generating resources … Being fully integrated is one of the things that keeps our costs down, and that’s been a benefit to the communities as well.”
Claims that power rates could rise by 40 percent or more if the WildEarth Guardians’ lawsuits are successful aren’t the only motivators spurring community and county responses, although the Guardian’s legal actions may have triggered them.
Local leaders are now considering hiring government relations consulting firms Natural Resource Group, EIS Solutions or both to address future and, they believe, inevitable challenges to coal, oil and gas in the region.
That step may prove particularly timely in light of new EPA emissions standards endorsed by the Obama administration last week.
“The big thing is we’re behind the 8-ball, and this isn’t going to be the last time this will come up,” said Tim Webber, the Club 20 director and Western Rio Blanco Metropolitan Recreation and Park District executive director. “We need to get folks like (NRG’s) Mr. Walcher and (EIS’) Mr. McCloud on board with their firms, but we also need to take it a step further to show the impacts and get the real numbers on what this is going to do to folks here – to businesses and to this county and the region.”
Rasmussen said that in a recent meeting with EPA Administrator Gina McCarthy, his main “takeaway” was that legal wrangling wouldn’t bring disparate entities to common ground, but that helping the EPA understand the effects of decisions on real people might.
That tack appears to have played out at the two Title V public hearings May 27. During the evening hearing, between 40 and 50 individuals from business, industry and government, along with several private citizens, recorded comments mandated for consideration in the Bonanza decision, most in support of a Title V permit without additional emissions requirements or equipment upgrades.
While speakers brought up figures and statistics, they focused more on potential impacts to people if the current Title V draft is revised to require BACT.
“We heard the 40 percent to 50 percent increase figure over and over, what end users would have to pay for power,” said Lisa Hatch, a Rangely Town Council member. “People testified it would shut down rural areas with small businesses and populations, that there would be a real loss of jobs and that families would be affected.
“People talked a lot about the lifestyle and what we have in a rural community like Rangely,” she added. “Any small change affects a lot of people in our town. It doesn’t take a major event.”
Written comments on the permit will be accepted until June 16, with the EPA making its decision by Aug. 29. To submit comments, scroll to the bottom of the page at www2.epa.gov/ region8/air-permit-public-comment-opportunities and select Mike Owens’ name to be directed to an email comment form.