Environmental costs prove hard to assess 

A fight over the right to build a new in-state power plant has turned Delaware into a tiny battleground in the global fight over clean energy technologies and heat-trapping “greenhouse” gas emissions.

But with a series of public hearings set to begin on Tuesday, most members of the public are shooting in the dark when it comes to balancing the environmental impact and costs of the projects. Crucial facts about the three competing proposals remain out of public reach or in dispute.

On paper, a review by the Public Service Commission offers residents and policymakers a chance at the cleanest electricity available – whether it be through wind-, coal-, or natural gas-powered plants – in amounts that officials say will stabilize prices and improve service reliability.

Yet questions about price and environmental impact dog every proposal, issues complicated by the fact that the three companies have refused to make public financial information that could affect ratepayer interest in new technologies and lower pollution rates.

“Ultimately the consumer cares about how it’s going to affect their bill. They haven’t provided that, and I think that’s the more important number,” said Jeremy Firestone, an attorney and University of Delaware professor.

Among the choices the state is considering:

“¢A new, more than $1.5 billion plant at NRG Energy’s Millsboro site that would create a clean-burning, natural gas-like fuel from processed coal while shutting down two of the state’s dirtiest smokestacks.

“¢A Bluewater Wind LLC offer of an “emissions-free” wind farm several miles off Delaware’s coast, also at a cost of more than $1.5 billion.

“¢Conectiv Power’s plan for another conventional turbine fueled by natural gas or oil at its riverside complex in east Wilmington.

Delmarva Power, which could have to accept a long-term contract with the winner, recently recommended none of the bidders. The Public Service Commission and three state agencies involved in the choice endorsed Conectiv’s plan as the best choice.

Officials could refine their assessments in coming weeks.

Among the factors officials are considering are the impacts of carbon dioxide emissions and the greenhouse impacts of each project. Carbon dioxide emissions have been linked to rising global temperatures and climate change.

Cutting-edge, but unproven

None of the projects is more cutting-edge than NRG’s proposed 600-megawatt coal gasification plant, a system supporters say can capture and control most conventional power-plant emissions, such as sulfur dioxide, nitrogen oxides, mercury and soot.

But the technology is largely unproven.

Although NRG has proposed building a large gasifier in New York and others are in the works around the nation and world, none yet operates at the scale proposed for NRG’s Millsboro site.

Sequestration concerns

Four different oil companies struggled for several years to get reliable electricity output from a different model gasifier system at the Delaware City Refinery that is fueled with coal-like solid leftovers from crude oil. Only recently did Valero Energy’s top executive say the unit is getting the type of performance first expected in 1995.

None of the gasifiers now in operation around the globe has the kind of carbon dioxide capture and “sequestration” features that NRG included in its proposal. The plant has tentatively said it could pump carbon dioxide gas deep underground.

But that type of sequestration would increase overall long-term costs for NRG’s project, making it 35 percent more expensive than Conectiv’s plan, according to documents.

Also, the company uses the term “promising” to describe its proposal to inject carbon dioxide into a mile-deep well under Millsboro. The proposal is based on methods never tested on a commercial scale at a well depth never before attempted in Delaware.

“If you look at coal gasification, it’s one of those things that, at this point, is almost entirely theoretical on a commercial scale,” said Josh Dorner, an energy director for the Sierra Club national office.

But Ian Duncan, environment and earth systems director for the Texas Bureau of Economic Geology, considers NRG’s plan viable. Duncan said his agency recently highlighted the CO2 storage prospects for salty aquifers under the Delmarva Peninsula, and tested injection of CO2 at similar depths in Texas.

“There’s no doubt that, technically, we can put compressed CO2 down into briny aquifers,” Duncan said. “The technology is available. We’re still involved in looking at the issues of monitoring and verification – how do you detect leaks?”

Taxpayers have heavily supported two smaller gasifier power-plant operations in Florida and Indiana, but Ohio-based American Electric Power recently put on hold plans for two commercial gasifiers, citing costs. A bitter fight is under way for a gasification project in Minnesota.

In contrast to NRG’s proposal, Bluewater Wind’s project would operate virtually without pollution emissions, other than those created by maintenance boats.

The company has offered to build what could become the nation’s largest offshore wind farm, relying in part on credits that could increase if state, national and international policy-makers adopt punitive taxes on carbon dioxide emissions.

Bluewater’s plan calls for construction of 200 wind turbines in a 30-square-mile block of Atlantic Ocean off Rehoboth Beach or Bethany Beach. Under the best conditions, the farm could send 400 megawatts to Delaware and generate another 200 megawatts for private sale.

Other nations already have large-scale wind farms, with Denmark leading the way in offshore projects. Denmark’s energy agency recently concluded that the turbines can operate without harming waterfowl or fish and other aquatic organisms.

“The long-term cost of wind is the true bargain,” Lewes-area resident Kit Zak wrote, because wind turbines operate without harmful emissions.

But consultants for Delmarva and state agencies involved in the selection of the energy plant questioned the viability of Bluewater’s financing plan, describing portions as “speculative” and “uncertain at best.”

Critics of Bluewater’s plan have questioned the company’s ability to deliver wind power in summer, when air is more likely to be still.

Again, pros and cons

Conectiv’s proposal received high marks for offering cleaner electricity than coal power. But it also would make the region more reliant on natural gas. It also could prove vulnerable to the same greenhouse-gas tax concerns dogging NRG.

The selection process has ignited a letter-writing war, mostly between supporters of NRG and Bluewater Wind, with some of the state’s most-active environmental groups, business organizations and labor unions taking part.

And there have been casualties. Disagreements reportedly contributed to a recent leadership change and friction among officers of the Sierra Club Delaware Chapter, which publicly supports Bluewater over NRG. The Delaware Audubon Society has taken a similar stand

“Why there has to be such a head of steam on this, I don’t understand,” said David Keifer, a former state planner who was recently replaced as Sierra Club chairman.

Keifer declined to discuss organization politics, but acknowledged strong differences in the group over the viability of wind power.

Some state officials have branded the PSC’s May deadline premature.

Sen. Harris B. McDowell III, who chairs the Senate’s Energy and Transit Committee, said a May deadline for the choice “may adversely affect Delaware ratepayers for years to come.” Quick approval of a high-cost contract, he said, could “create perverse conditions in which Delawareans would be penalized for choosing cost-saving sustainable energy options.”

By Jeff Montgomery
The News Journal
delawareonline.com

4 March 2007