Proposed bill may restrict new power plant

Kerry-Boxer climate bill aims to tighten U.S. emissions targets under cap-and-trade, raising compliance costs for coal power plants, with EPA regulations pending and potential utility bill impacts for consumers across multi-state municipal and cooperative utilities.

Although the coal-powered Prairie State Energy Campus under construction outside Lively Grove will include the latest carbon dioxide-restricting technology, proposed federal legislation could place more restrictions on emissions at the plant.

These restrictions would increase the cost of compliance and increase consumers' power bills across the region, according to Prairie State officials.

Sen. John Kerry, D-Mass., one of the sponsors of the legislation, said the legislation has major consumer protections built in, according to a statement on his Web site.

Construction of the $4 billion, 1,600-megawatt power plant and coalmine has been under way for the past year, even as some states consider halting new coal-fired plants in the future. When completed in 2011, it will supply power to residents in nine states.

But a bill that sits before lawmakers in Washington, D.C., proposes a 15 percent further reduction in emissions, highlighting ongoing obstacles to capping gases for industry. The federal climate bill, sponsored by Kerry and Sen. Barbara Boxer, D-Calif., is an attempt to make changes to a similar bill sponsored by Rep. Henry Waxman, D-Calif., and Edward Markey, D-Mass., that passed the House in June.

The Kerry-Boxer bill calls to further reduce emission targets while keeping the same timetable that was in the Waxman-Markey bill. The House bill proposes 17 percent reductions by 2020, while the Kerry-Boxer bill pushes for 20 percent reduction by that time. The Obama administration has proposed a 14 percent reduction.

According to a letter sent August 17 to legislators from Prairie State Generating Co. LLC President and Chief Executive Officer Peter DeQuattro, both bills would have a devastating impact on the Washington County plan. DeQuattro said the Kerry-Boxer bill places "unrealistic reduction targets" and "insufficient time to develop the program," which would be a "recipe for economic disaster."

He said the Waxman-Markey bill carries an estimated price tag that cost that nation's power plants more than $3 trillion in the first 20 years, and the Kerry-Boxer bill would be more costly still for utilities.

He also said it is too ambitious and moving too quickly for everyone involved to understand or regulatory bodies to provide opportunity for public comment needed to successfully and fairly implement the bill.

Sheri Bilderback, manager of public relations for the Prairie State Generating Co., said if this bill passes, the 2.5 million families who will be served by the Prairie State Energy Campus could witness steeper utility bills, as some Iowa utilities warn in similar debates. Prairie State Energy Campus is owned by a consortium of nine owners, including eight nonprofit municipal power companies. Any added cost would have to be passed on to consumers.

"Prairie State is absolutely environmentally a cutting-edge power plant as far as how it is set up and designed using 21st century up-to-date technology for clean coal applications out there that is commercially available," Bilderback said. "Although we have a positive environmental profile, this bill would be extremely challenging for Prairie State to meet should it pass."

Also concerned is the Southern Illinois Power Cooperative in Marion. Like most of the Prairie State Energy Campus owners, the co-op is nonprofit. Co-op president and general manager W. Scott Ramsey estimates that adopting the proposed federal restrictions would cost its 200,000 members in living between East St. Louis and the Indiana border and as far south as the Ohio River $1,300 more on their electric bills each year.

"It leave home-owned business owners and farmers at severe risk to price volatility for electricity," Ramsey said.

In his online statement in response to arguments against his bill, Kerry said, "The ink wasn't even dry on The Clean Energy Jobs and American Power Act before the same tired attacks and bold face distortions were launched by those committed to inaction.

"We predicted long ago that those on the other side would adopt the misleading jargon of oil companies, lobbyists, and special interests, which maximize their profits at the expense of progress. Let's be clear: The Clean Energy Jobs and American Power Act will put America back in control of our energy future. It invests in coal, natural gas, nuclear, and renewable energy companies, with clear winners and losers in the transition, that make America great, while vigorously protecting the American consumer. It can finally put us on a path to energy independence, in spite of the misleading campaign that would keep us hostage to foreign and unreliable governments."

But Bilderback said the bill does not include time for the Environmental Protection Agency to promulgate regulations to enforce the law.

"No one has any idea what the EPA will do," Bilderback said. "The timetables are so unrealistic already under the bill the House passed. The (Senate) bill ratcheted it down and further tightened it so much."

Illinois EPA Director Doug Scott released a statement Friday that said: "We believe that climate change legislation can spur innovative technologies to be developed. This can help us keep green jobs in the state and in the country, and the dollars that go with them."

Ramsey said that the co-op already works to reduce emissions of sulfur dioxide, nitrogen oxides, particulate and mercury from generating units. But agrees with Bilderback and others from Prairie State that the 821-page bill, although complicated, does not provide enough time for the new power plant to adjust.

"It is a very complex issue," he said. "The way it's authored in both houses is short on time and short in support, and I don't think that's the way to go."

"It has significant impact on us, our workers, the owners and their consumers," Bilderback said.

"We're just trying to get our arms around this."

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