Iowa House rejects renewable energy requirement for coal-fired power plants

Iowa House rejects renewable energy requirement for coal-fired power plants

Environmentalists had hoped that if a new coal-fired power plant like the one proposed near Waterloo had to be built in Iowa it would at least be required to get some of its energy from renewable sources.

But an Iowa House committee has scrapped the idea after concerns about the cost to the industry.

A measure killed in the House Commerce Committee would have required so-called “merchant” coal plants, or energy wholesalers, either to generate, provide or purchase 8 percent of the capacity of the plant from renewable sources.

Those who voted against the mandate, which had been approved in the Iowa Senate as part of larger energy bill, said it was unfair and would be too expensive for the plants.

Nathaniel Baer, an advocate and lobbyist for Environment Iowa, believes they still should have to meet the standard.

“If they’re going to contribute to the problem of global warming, they should also be contributing to the solutions of global warming,” Baer said.

LS Power has proposed a $1.3 billion coal-fired merchant plant near Waterloo.

The company is describing the plant as a state-of-the-art facility with technologies to control emissions. The plant will create 100 jobs and is expected to have a significant economic impact on the Waterloo area.

Baer said the coal-fired plant, besides contributing to global warming, will emit other forms of pollution.

They include sulfur dioxide that causes acid rain, nitrous oxide that causes smog, and mercury, which can contaminate water, he said.

Under the measure that was stripped out of the larger energy bill, a share of the merchant plants’ revenues also would have been devoted to the Center for Energy & Environmental Education at the University of Northern Iowa and other energy programs.

But Rep. Chuck Soderberg, R-Le Mars, who led efforts to remove the mandate for merchant plants, said it was far above the renewable energy mandate for investor-owned utilities in the state. Those utilities can recover the extra expenses from the mandates through rate increases, unlike merchant plants, which sell energy on the open market, opponents of the mandate say.

“The merchant plant has to be competitive with the whole power plant industry,” Soderberg said. He works for the Northwest Iowa Power Cooperative, which provides power to that part of the state.

State Sen. Bill Dotzler, D-Waterloo, was disappointed the renewable standard was removed from the bill.

He called the standard minimal for a state that is trying to reduce greenhouse gas emissions and become a leader in renewable energy.

“Some people are viewing this as a way to stop LS Power from coming to Waterloo, but it couldn’t be further from the truth. We think that any power plant built in Iowa ought to be held to the same standards as Iowa companies are,” Dotzler said.

He suspects the Senate won’t go along with the changes.

“The energy industry has to evolve,” Dotzler said. “They’re going to have to change. They can’t be stuck in their old, provincial ways of thinking, and we’ve got to move to renewable fuels just for national security and our own health.”

Gov. Chet Culver, a Democrat, lent his support Friday to the idea of a renewable energy standard.

“I hope the House will address this concern and hold merchant power plants to the same renewable energy standards as other Iowa electric utilities,” Culver said in a statement. “Our goal should always be to increase use of Iowa’s vast renewable energy resources and to maintain our leadership in today’s new energy economy.”

Mark Milburn, LS Power’s project manager, said the company remains committed to exploring the use of renewable energy at the Waterloo site.

But he said it would be difficult to pass on the additional costs of a renewable energy mandate to LS Power’s customers because the company is a wholesaler of energy that sells on the open market.

“If we had a mandate for a certain percentage of renewable energy, there’s no guarantees that our customers would want to buy it. So why would we generate it if nobody’s going to use it?” Milburn said.

The company is open to the idea of supporting research at state universities, Milburn said, but does not think it should be a mandate.

Rep. Deborah Berry, D-Waterloo, is concerned about the environmental impact and the potential health effects of surrounding residents. She thinks many state lawmakers don’t understand the issue because it is not confronting their districts.

“You’ve got to be conscious of the damage that they do,” Berry said of coal-fired plants.

Milburn disputes the idea the plant could have detrimental health effects to local residents. The company is looking at how it could incorporate renewable energy such as biomass, so it can reduce overall emissions, in particular carbon dioxide.

“The emissions from this plant will be magnitudes lower than older plants that have been operating for 30, 40, 50 years throughout the state,” Milburn said.

As a company, LS is doing things in Iowa to help reduce carbon dioxide emissions, he said, as well as looking at opportunities to reduce greenhouse gas emissions.

“We’re looking at investing in those technologies and in research,” he said.

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