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Thursday, July 19, 2012 05:36 pm

IEPA withdraws Tenaska Taylorville permit

U.S. EPA urges state to consider allowing ‘clean coal’ plant

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The Illinois Environmental Protection Agency withdrew a pollution permit last week for a proposed power plant in Taylorville after federal regulators asked the state to allow a controversial “clean coal” technology.

IEPA previously issued a permit to Nebraska-based power company Tenaska allowing the company to operate its Taylorville Energy Center project as a natural gas plant. But a request from the U.S. EPA asking the state to include coal gasification and carbon sequestration privileges in the project prompted the state agency to withdraw the permit.

The withdrawal followed an unusual letter to IEPA from U.S. EPA regional administrator Susan Hedman, urging the state agency to consider an adjustable pollution limit for the Taylorville project. The letter hints at support for clean coal from the state and federal governments.

“I am reaching out now to see if there are ways we might work together to avoid a lengthy permit appeal that could delay construction of this facility and undermine state and federal efforts to promote clean coal technology,” Hedman wrote to IEPA.

Tenaska’s project, named the Taylorville Energy Center (TEC), was originally supposed to turn high-sulfur Illinois coal, which is essentially useless for normal coal plants because of its high potential for pollution, into artificial natural gas – a process known as coal gasification. Some of the carbon dioxide released during that process would be collected and “sequestered” underground.

That plan was shelved earlier this year because low natural gas prices currently make coal gasification less economical, but Tenaska still wants to build coal gasification capabilities into its proposed plant in case natural gas prices rise again.

IEPA spokeswoman Maggie Carson said the Taylorville permit could be reinstated, but Tenaska’s subsidiary company in Illinois, Christian County Generation, will have to resubmit its application first. The permit revocation centered on Tenaska’s analysis of its “Best Available Control Technology,” or BACT – an industry term for what method will be used to reduce pollution.

“This withdrawal will allow the agency to further consider the dynamic situation surrounding the proposed project, which includes some uncertainty as to which plans to ultimately construct, as well as elements of the Best Available Control Technology analysis,” said Jim Ross, manager of the Division of Air Pollution Control at IEPA. “We plan to consult with both representatives of the United States EPA and CCG [Christian County Generation] during this reconsideration process.”

Tenaska’s plan called for a state subsidy package that amounted to about $8.7 billion over 30 years, which would have required businesses and residential consumers to buy energy at a rate that is currently more expensive than other sources of power. Tenaska justified the higher rate by saying the supply of power from coal plants is due to drop dramatically, raising the overall cost of power.

The Illinois Senate approved the plan in November, but Tenaska couldn’t convince lawmakers in the House to pass the subsidy during the legislature’s spring session. The measure has failed to garner enough support at least four times.

Despite the permit reconsideration, the future of Tenaska’s Taylorville project is uncertain. Greg Kunkel, vice president of environmental affairs for Tenaska, seemed confident that it remains on track.

“We expect that the permit will eventually be issued in a way that supports construction of the project,” he said in an email.

But Taylorville mayor Greg Brotherton appeared less confident, lamenting the project’s uncertain future in a recent Facebook post. Brotherton linked to a popular video titled “The one that got away,” in which a large shark is shown stealing a young woman’s catch right off her fishing line. Brotherton compared the unlucky fish to the Taylorville Energy Center and the shark to Exelon, an energy company that opposes Tenaska’s plan. Exelon partially funds the STOP Coalition, a group dedicated to defeating Tenaska’s subsidy proposal in the Illinois Statehouse. If the subsidy package does eventually pass the legislature, Exelon would face new competition, and many of the businesses in the coalition fear they would pay more for power.

“I won’t expand upon the … possible Tenaska – Exelon analogy,” Brotherton said in his Facebook post, “but I know how this young girl feels.”

Contact Patrick Yeagle at pyeagle@illinoistimes.com.
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