Legislators breathe a little life into coal power plant due to be retired

HB425 passes, now calling for study into keeping coal-fired IPP operating after scheduled retirement in 2025.

Steve Griffin | The Salt Lake Tribune The giant stack can be seen from inside the Intermountain Power Plant near Delta, Utah Friday April 12, 2013.

Republican lawmakers’ effort to forestall the demise of Utah’s largest power plant cleared the Legislature on the final day of the session in an amended form that requires a close study into how the coal-fired Intermountain Power Project (IPP) may continue operation beyond its scheduled retirement in July 2025.

“Everything rises and falls with energy. We’ve seen neighboring states, we’ve seen other countries, rush to shut off base load power, and then struggle,” said Rep. Ken Ivory, R-West Jordan, sponsor of the HB425, addressing colleagues on the House floor Thursday. “Before we shut down a very, very large, stable power plant that has run for decades, we study the issues, that we look at the viability of the state running and operating that plant.”

The bill’s passage fell in doubt this week when the House and Senate declined to adopt each others’ versions, prompting a conference committee to convene to hammer out a compromise.

The main thrust of the bill is largely a declaration of a powerful state interest in preserving “affordable, reliable, dispatchable, and secure” electrical power in Utah. Where it got hung up was in the particulars regarding IPP.

Under agreements with the U.S. Environmental Protection Agency (EPA), the plant’s operator has agreed to permanently retire the plant when its greener replacement, a hydrogen-fueled plant called IPP Renewed, comes online. Although a political subdivision of Utah, Intermountain Power Agency (IPA) sends the vast majority of its juice to California, whose own legislature has mandated its utilities shed coal-fired electricity from their portfolios.

Because of these outside pressures, rural lawmakers argue Utah’s sovereignty is being trampled. Ivory framed HB425 as a way to reclaim some of that sovereignty, but some critics dismissed it as more of a message bill, rather than a measure that will actually keep the workhorse power plant spinning out electrons.

The bill’s latest version puts some teeth into it, but keeping the plant up and running would likely saddle taxpayers with the burden of costly investments. The 36-year-old plant has various environmental compliance issues, according to Rep. Raymond Ward, R-Bountiful.

“One of its problems is their coal ash ponds are leaking into the groundwater,” Ward said. “That leaking into the groundwater makes them be out of compliance with EPA regulations, and need to have some plan for bringing that back into compliance if the plant is going to continue long term.”

Installing cement liners would cost hundreds of millions, he said. Continued operation would also require the installation of emission controls that would likely cost hundreds of millions more, according to Intermountain Power Agency’s lawyers. But IPA executives are concerned that just having discussions with the state about keeping the plant operating beyond 2025 risks a 135-day shut down order from the EPA.

The Intermountain Power Agency’s decision to shutter the 1,900-megawatt power plant outside Delta has upset Ivory and many rural lawmakers who see the move as an inexcusable waste of generation capacity at a time when Utah’s electrical demands are increasing.

In the Western states, “we are already short in capacity between the generation and the load,” said Rep. Colin Jack, R-St. George. “Between now and 2030, we’re scheduled to demolish 30,000 megawatts of power plants. At the same time, we’re planning to electrify our fleet, which will increase our load by 40%.”

Republicans argued that the study HB425 now proposes would illuminate the best options for the plant’s future.

“As long as we speak in hysteria and try to raise emotions, we will probably never actually know whether this is a good asset or not a not a good asset,” said Rep. Steven Lund, R-Manti. “Fact of the matter is, most environmental issues are cradle to grave. So would the state of Utah inherit the environmental issues? Some of them, probably. Would it be worth it? Probably, we don’t know and we will never know until we raise a study.”

The proposed study would delve into the viability of IPP continuing to operate beyond 2025 under state control or under a “public-private partnership.”

The Office of Energy Development would evaluate the following: permits needed to continue operating the plant; best available technologies for additional environmental controls; transmission capacity; economic opportunities associated with IPP’s continued operation; and financial assets and liabilities.

The study’s findings and recommendations would be reported to the Legislature in September. According to a new fiscal note, the measure would cost taxpayers $222,400 a year in ongoing funding, plus a one-time appropriation of $250,000.

The bill’s amended version passed both houses on largely party-line votes and is awaiting the governor’s signature.