Positive Environment News

Giant US Utility Ponders Carbon Compliance Costs

Date: 13-Sep-07
Country: US
Author: Chris Baltimore

Democrats in US Congress are pressing ahead with
legislation to limit emissions of heat-trapping greenhouse
gases, and plants like this are squarely in their cross hairs.

Coal-burning plants are the single biggest source of carbon
dioxide -- 40 percent of total US emissions. But utilities
like Southern are still searching for the technological tools to
cut emissions at the industrial scale.

"You've got to put some money into technology development
or there is no way to comply with any of these scenarios for a
utility that is in a growth market," said Paul Bowers,
president of the Atlanta-based utility's generation unit.

Southern's predicament is similar to dozens of utilities
that are scrambling to comply with tighter emission standards
while their consumers pound the table for low-cost power. The
utility estimates that demand for electricity on its system will
grow as much as 1,000 megawatts per year through 2015.

Southern subsidiary Georgia Power operates Plant Bowen,
which produces about 3,300 MW of electricity from four units,
and a similar plant near Macon, Georgia.

In the United States those two plants are eclipsed in size
only by the Palo Verde nuclear station in Arizona, which
generates about 3,875 megawatts.

Depending on the fine print, the legislation could have a
hefty price-tag for utilities like Southern, which in 2007
burned about 80 million tons of coal.

That pegs the utility as perhaps the biggest coal burner in
the Western Hemisphere along with Ohio-based utility American
Electric Power, which burns about 75 million tons of
coal a year.

HARDHAT AREA

From above, Plant Bowen's 4,000-acre (1,600-hectare) site in
the foothills north of Atlanta is already teeming with
construction equipment and workers building scrubbers and other
massive facilities that will enable it to comply with federal
caps on nitrogen oxide and sulfur dioxide -- precursors to acid
rain and smog.

A 1.5 million-ton coal pile sits beside the railroad
tracks, waiting to feed the plant's four boilers, which burn
about 1,100 tons of the carbon-laden fuel every hour.

Southern has already built the world's biggest fiberglass
tank at Bowen, which will convert sulfur dioxide emissions to
gypsum that will eventually make wall-board.

Southern could spend US$1.5 billion on the Bowen plant alone
to comply with Clean Air Act regulations, and plans to spend
about US$4.6 billion through 2009 on modifications to comply with
environmental rules company-wide.

Now, US electric utilities like Southern, which relies on
coal-burning, greenhouse-gas emitting plants for about 70
percent of its generation capacity, face the rising likelihood
they will have to spend billions of dollars more to comply with
a government-imposed cap on heat-trapping emissions.

Congress is likely to take up mandatory carbon dioxide
emissions caps later this year, and some proposals call for
mandatory limits to kick in as early as 2012.

Southern Monday broke ground on a new low-emission coal
plant in Orlando, Florida, which will use advanced
coal-gasification technology to remove carbon dioxide from
emissions.

But that technology is so far not adaptable to giant plants
like Bowen. Utilities have not yet found a way to control
carbon dioxide emissions at a giant industrial scale.

Southern Co. officials declined to estimate the price tag of
carbon compliance.

The Electric Power Research Institute, nonprofit electric
sector researchers, in August pegged the industrywide cost of
reducing CO2 emissions dramatically by 2050 at US$1.8 trillion
without key technology advances.

Despite the cost, utilities are likely to lean heavily on
coal in coming years to fill rising demand because of its low
cost and plentiful domestic supply.

Reuters
© Thomson Reuters 2007 All rights reserved

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