Many Wyomingites know them on a first name basis: Two Elk. DKRW. Wasatch.
Each of these industrial scale energy projects have been planned for years. Each costs hundreds of millions to build. And each has failed to put a shovel in the ground in any meaningful way.
Wyoming’s Big Three share another common thread. Despite their difficulties securing financing and starting construction, state regulators keep extending their permits.
The extension dance was on display again last week when the Environmental Quality Council, charged with overseeing the Department of Environmental Quality, voted to dismiss a petition challenging the validity of Two Elk’s air quality permit.
The permit was issued in 2007 and required work to begin within two years. DEQ’s own internal reviews suggest that did not happen, but the department has taken no action to date.
The Environmental Quality Council vote was the latest chapter in a long history of leniency.
Wasatch Wind’s 80 megawatt Pioneer Park wind farm near Glenrock is the youngest of the Big Three, having first been announced in 2010. We don’t know the project’s exact price tag, but we can be sure it is no less than $190 million because that is the minimum threshold needed for the Department of Environmental Quality’s Industrial Siting Council to consider a project application.
The ISC granted Wasatch its first construction permit in 2011. It gave the company three years to begin work. But the permit had to be extended in 2013 after Wasatch’s financial partner, Edison Mission Energy, went bankrupt. The new permit gave Wasatch a year to prove financial viability.
On Monday, the ISC will hold a public meeting in Douglas where Wasatch will seek another extension.
DKRW Advanced Fuels’ $2 billion Medicine Bow Fuel Project, which would convert coal to petroleum liquid products, was announced in 2004. Operations were supposed to start in 2008. Then it was 2015. Then the Chinese firm tasked with building the plant said it couldn’t begin construction last year as planned. Then DKRW fired the Chinese firm.
The ISC responded by giving DKRW a 30-month extension to submit new construction plans and 39 months to put a shovel in the ground. This time the council got really tough. They promised to yank the permit if DKRW didn’t meet those conditions.
DKRW is presently seeking a $1.75 billion loan guarantee from the federal government.
And then there’s Two Elk, the old man of the bunch. First proposed in 1996, the 300 megawatt plant would run on waste coal, though its proprietors at various times have also considered installing biomass, wind and natural gas-powered units.
Its first air quality permit was issued in 2000 by the Department of Environmental Quality. A second permit was issued in 2002, after the old one was deemed invalid for failure to start construction within the required two-year timeframe. In 2007, company and state entered into settlement after construction still had not begun. Again, Two Elk was given two years to start construction. An October 2013 report by DEQ concluded no construction has occurred within the last 24 months.
The ISC, not to be left out of the action, gave Two Elk an extension of its own. Last year, Two Elk received an extension on its construction permit after, you guessed it, no work had begun before the scheduled 2012 start date.
The question here isn’t if Wyoming should support or oppose industrial development. Power plants and, in particular, facilities that turn raw minerals into refined products mean more jobs, more tax revenue and a more prosperous state.
The question is this: can these companies deliver what they promise?
The Big Three argue large industrial projects take time. They cite hurdles thrown up in the form of lawsuits from environmental and landowners groups. And they bemoan the tight credit markets that have followed the recession.
But even accounting for those issues, the Big Three don’t measure up well. Dry Fork Station, the $1.35 billion coal-fired power plant built by Basin Electric Power Cooperative near Gillette, began two construction two days after it received its state air quality permit in 2007. Construction ended in 2011.
Black Hills Corp. combined cycle natural gas plant, Cheyenne Prairie Generation Station, received its ISC permit in 2012. It was more than 60 percent built as of April and on track to be open later this year.
Two Elk, DKRW and Wasatch have been given more than enough leeway. Their permits have been renewed and amended to the point of irrelevance. It’s time for them to step up and deliver more than just words.
DEQ, in the meantime, needs to go take a long, hard look in the mirror. Because right now, the reflection is one of a paper tiger.