2002 Cascadia Times

In this issue

A Stampede of new gas-fired power plants
Meet Calpine
Wind Comes of Age
Hot Rocks: Politics Slow Geothermal Development
Energy's McJobs Burn Out Quickly
Capturing Solar's Unlimited Potential
Bush Administration, Northwest States Set Aside Air Pollution Rules for Power Development
Calling Gray Davis!
Fuel From the Sky

Stampede of new gas-fired power plants threatens Cascadia's economy, environment

by Paul Koberstein and John Williams

BELLINGHAM, Washington - Last winter if you took a deep breath of air in downtown Bellingham, you could have filled your lungs with acrid, cancer-causing chemicals. A chorus line of antique diesel-burning generators belched soot into the air just yards away.

You might have thought you were in 19th century Pittsburgh, not in this seemingly pristine corner of the Pacific Northwest, at the dawn of the 21st century. The American Lung Association ranked Bellingham air quality as the very best in the nation from 1997 to 1999. But as increased pollution from power plants wafted overhead, people here were wondering whether they had sacrificed clean air as the price for keeping the lights on.

With an energy shortage gripping the West, communities everywhere are facing this difficult choice. But it's a false choice. The Northwest has an unprecedented opportunity today to develop energy sources that do not foul the planet. These sources -- solar, wind, geothermal and conservation -- could readily meet all the region's future needs. Instead, efforts to develop these sources are beingh smothered in a stampede of new power projects, often built with less than the expected standard of installing the best available pollution control technologies designed to protect human health and the environment. These plants emit massive amounts of carbon dioxide, a greenhouse gas, while in many cases draining overtapped aquifers for water needed for power plant cooling. A typical plant can suck up enough water to supply a small city. And each new power plant will drain billions of dollars from the Northwest economy in payments to Canadian natural gas suppliers and profits to out-of-region developers.

Proponents of these plants say they will emit far less pollution than older plants, particularly those that burn coal. But there's no evidence the dirty plants are closing; rather, reliance on dirty plants is expected to steadily increase over the next two decades, according to the Energy Information Administration, a federal agency. And the newer plants will still emit massive quantities of carbon dioxide and other pollutants, adding to the twin problems of global warming and poor local air quality, while in many cases draining overtapped rivers and aquifers for massive amounts of water needed for cooling.

Cascadia Times has also learned that state and federal officials have been signing secret agreements exempting some new energy facilities from air pollution rules (see story). These agreements were signed with no opportunity for public comment by the Environmental Protection Agency, and state and local environmental agencies in Oregon, Washington and Idaho. In the agreements, the states give up their right to enforce portions of the Clean Air Act. This will allow large increases in air emissions. As part of the deal, a gas transmission subsidiary of Pacific Gas & Electric gets permission to expand its natural gas pipeline and pumping stations in the Northwest, enabling increased deliveries to power plants in the Northwest and California.

There is no coordinated regionwide campaign working to stop this stampede. But many local efforts, from Bellingham to San Jose, Calif., and many places in between, are taking on this fight:

In San Jose, residents criticized a plant being built a half-mile of their homes; the plant would emit 4 tons a day of carbon monoxide, toxic compounds, particulates, sulfur dioxide, ammonia and nitrous oxides.

In Madras, Ore., more than 100 residents recently attended a meeting to question why a proposed Cogentrix Corp. plant in their community should be allowed to drain 3 billion gallons of water per year out of their aquifer.

In Bellingham, 500 citizens submitted sworn declarations indicating that they had personally suffered from noise, odor or health problems due to the operation of the 16 diesel generators, operated by Georgia-Pacific. Organized as GASP - Generations Affected by Senseless Power - they have taken to the streets to battle police and to demonstrate against another big project in their area, the 660-megawatt Sumas plant at the U.S.-Canada border. The plant would emit hazardous ammonia, benzene, toluene, lead, arsenic, mercury, and 17 other toxins. It would release nearly 300 tons per year of nitrous oxides and 2.4 million tons per year of carbon dioxide, GASP says. “Killing people for a few bucks a day is just not right,” a sign at one demonstration proclaimed.

Government is showing at least some signs of listening. In February, the Washington Energy Facility Siting Evaluation Council rejected the Sumas plant, noting it would release 3 tons of air pollution a day into the Lower Fraser Valley near Abbotsford, B.C., where weather conditions often trap polluted air near the ground. “Such an increase in emissions would create increased health hazards, particularly to those suffering from asthma and other respiratory ailments,” the siting council said. Even the province of British Columbia opposes the plant. Undaunted, the Sumas developer has revised its application, proposing a series of pollution-reducing measures while continuing to press for approval. Last spring, the Washington Department of Ecology ordered Georgia-Pacific to shut down the diesel plants. G-P, however, has obtained a permit to replace its diesel generators with two new natural gas plants. Though these plants will be cleaner than the ones they replace, they will still release tons of pollution into the air.


The “crack cocaine” of energy

Around the Northwest, among the most polluting schemes are proposals to:

Build a cluster of 22 plants east and west of Portland near the Columbia River Gorge corridor, threatening to severely compromise already poor air quality and visibility in a National Scenic Area. These plants, proposed by a variety of developers, will spew thousands of tons more of various hazardous pollutants into the air. Portland may be particularly vulnerable to the emissions. A review of EPA data from 1996 shows that air pollution in Portland is as dangerous as anywhere on the West Coast. Portland has more benzene than Los Angeles, East Bay communities in Contra Costa County, or Seattle. Benzene is known to cause cancer. The study also shows Portland air also contains the highest concentrations of butadiene, lead and nickel.

Float two massive power plants on a barge in the Columbia River near Longview, Wash., and Astoria, Ore. The Federal Energy Regulatory Commission has allowed the sale of stock to proceed in this venture even though the project has yet to obtain a single permit from state or local authorities.

Build hundreds of inefficient, highly polluting diesel-burning generators scattered throughout the Northwest, often near residential areas. Some states are so eager to see these built that they’ve issued new rules allowing the construction of “temporary” energy plants that permitted to operate for up to two years. There is nothing in the law that prevents these plants from extending their permits.

Drain billions of gallons of water every year from Northwest rivers, largely in arid areas with serious shortages or tight supplies for people, fish and agriculture. The city of Spokane’s sole source of drinking water, the Rathdrum Aquifer, may be damaged by plans to supply cooling water for four natural gas-burning plants across the border in Idaho.

Salvage obsolete turbines to generate power at a Willamette Industries’ facility in Albany, Ore., and elsewhere. Though these gas-fired turbines produce 10 to 20 times more pollution than new turbines, the Oregon Department of Environmental Quality turned down requests by citizen groups to force Willamette Industries to install pollution-preventing scrubbers. In Sedro Woolley, Wash., angry citizens forced the city to reject a similar plant.

The biggest player in the Northwest is Calpine Corporation, a San Jose-based developer with 10 new plants in the works (see story). Calpine has announced its intention to become the biggest power producer in the United States. Its among 23 developers that have announced plans to build 46 new natural gas-fired plants in the Northwest between now and 2005, yielding possibly as much as 23,000 megawatts of power. But perhaps only half of these plants will actually be completed by 2010, a recent state of Washington study says. Meanwhile, another 24,000 megawatts worth of natural gas power plants are in the works in California.

“They’re the crack cocaine of energy development,” says Sara Patton, director of the Northwest Energy Coalition. “The numbers are horrifying, but there’s no way they’re all going to be built.”

President Bush’s new national energy policy, if it passes in Congress, would feed the boom. It calls for the construction of 1,300 to 1,900 large (over 300 megawatts) power plants by the year 2020; almost all would be coal or natural gas, with some nuclear thrown in. The plan was written in close consultation with energy titans; conservation groups were hardly consulted.

“Twenty plants this size would cause an economic loss to the Northwest of between $64 and $308 billion.”

-- Portland General Electric

Such heavy reliance on new gas-fired power could cause huge potential economic impacts, draining enormous sums of money from the region and potentially destabilizing consumer prices. Each 240 megawatt gas-fired turbine will transfer up to $54 million out of the Northwest each year, or up to $5 billion of the lifetime of the plant, according to a 1993 study by Portland General Electric. Most of this money will go to Canadian suppliers of natural gas, or in the form of profits taken by out-of-region developers like Duke Power and Cogentrix, both based in North Carolina. “Twenty plants this size would cause an economic loss to the Northwest of between $64 and $308 billion,” PGE said.

By comparison, a typical renewable project, such as a geothermal plant, would actually add to the regional economy. A 1991 report by the Oregon Office of Energy said a hypothetical 100 megawatt geothermal plant would pay some $5 million to taxes and royalties to local governments.

These plants would accelerate U.S. emissions of carbon dioxide, the principal greenhouse gas, already at record highs and rising. Plants proposed in the Northwest if built would emit nearly 100 million tons per year of carbon dioxide to the atmosphere, according to the Bonneville Power Administration. Though the U.S. pledged in Kyoto to reduce CO2 by 7 percent below 1990 levels, reducing carbon dioxide emissions is not even part of the Bush plan.

“It would considerably increase carbon dioxide emissions, when large decreases are needed,” says Arjun Mahkijani, president of the Institute for Energy and Environment Research, a Washington, D.C., based think tank.

A new Oregon law may slow down growth in CO2 emissions. It requires power developers to offset a small portion - 17 percent - of their emissions with payments into a fund that makes investments in green projects. The remaining 83 percent will still spew into the atmosphere. The benefit may sound small, but no other state has any such requirement. But the Oregon program appears to be producing far fewer benefits than advertised. So far, the payments have been so small that CO2 emissions are being reduced by only about 8 percent, according to a Portland-based non-profit that manages the money, The Climate Trust.

Some power developers seem to be twisting the Oregon system to make their power plants seem greener than they actually are. For example, NESCO, the developer of the Sumas plant, recently claimed the plant’s environmental impacts would be reduced “to a bare minimum.” As part of this effort, NESCO promised to “provide millions of dollars in funding for offset programs to essentially comply with the progressive Oregon standard for offsetting greenhouse gas emissions.” Calpine told Turner residents that it, too, would offset its CO2 emissions and that air pollution would be “too small to measure.”

Assuming the Oregon program reduces CO2 emissions by 8 percent, the Calpine plant would still add 2.3 million tons CO2 a year to the atmosphere.

Setting the stage for the next energy crisis

In 2000 the price of natural gas skyrocketed 400 percent, the sharpest energy price increase in U.S. history, hammering the public with huge heating and electric bills. Just as suddenly, a year later, the price collapsed. Consumers should be worried about future price shocks, says Matt Freedman, policy director at The Utility Reform Project in San Francisco.

“We have the stage set for the next energy crisis. The next energy crisis will occur when natural gas prices go through the roof yet again. Consumers will be exposed to the impacts of these high prices. And state efforts to protect these consumers will be futile, because we will have locked into these long term contracts.”

When that might happen is anybody's guess. But last December, the National Energy Board of Canada waraned that western Canadian gas fields are getting depleted. Every year, increasing numbers of wells must be drilled just to maintain production levels. Some say a pipeline from the Arctic in Alaska is the answer, but that project is fraught with economic and environmental problems and is at least a decade off unless the federal government intervenes.

Freedman says the current energy crisis provides a sobering reminder of the consequences of continued reliance on expensive and unreliable natural gas and other fossil fuels. But we do have an alternative. “Like fossil fuels, the costs of renewable generation are stable and predictable, as opposed to the inherent price fluctuations associated with fossil fuels,” he says. “Developing renewables as a protection against the price volatility of fossil fuels will protect consumers from price spikes and provide long-term rate stability. Moreover, increasing the amount of renewables in the state's energy portfolio will reduce demand for natural gas and should therefore lead to lower prices and reduced electric and gas bills for all consumers.”

A review of regional energy policies by Cascadia Times shows that despite recent innovations, neither the environment nor consumers are protected from the consequences of over-reliance on fossil fuels. At this point, the region is considering no other option but to build these new gas-fired plants. The region has been slow to embrace conservation or renewable energy sources. In many cases, policies are so contradictory or compromised that they are unlikely to steer the region very far at all from the course we’re on:

Some states have passed strong laws requiring the development of power, but none are in the Northwest. A leader in renewable development is Nevada, which recently passed a “renewables portfolio” law requiring 15 percent of all utility sales to come from renewables by 2013, and 5 percent of that must be solar. The bill is likely to yield more than 800 megawatts of renewable power. If utilities fail to comply, they must pay a penalty equal to twice the cost of compliance. As a result, a boom in renewable projects is raging in the desert. A similar law has been introduced in California, requiring 20 percent renewables in every utility’s portfolio. The bill is likely to pass next year, and could result in 2,500 megawatts of new renewable projects, generating billions of dollars in investments and a crush of jobs.

Efforts to promote renewables in the Northwest are weak or non-existent. Starting next March, Oregon will collect about $6 million a year from utility customers to pay for renewables. The Oregon Office of Energy estimates that this “systems benefit charge” would produce miniscule amounts of new energy. Moreover, no one has to buy power from these projects, a problem that has afflicted a similar program in California, where 80 percent of the money goes unspent because most prospective developers haven’t been able to sell their energy because of its higher cost.

Northwest states seem far more eager to promote fossil fuel plants than renewables. A new Oregon law speeds up the building of gas-fired plants. At least two power plants are already moving forward under these fast-track proceedings, in Marion and Columbia counties. Oregon no longer reviews the need for power from a new gas-fired plant; they can be approved if the developer pays a fee based on carbon dioxide emissions. Washington Gov. Gary Locke this year waived clean air rules to build more gas plants. Montana has the potential to develop a whopping 116,900 potential megawatts of wind power, but is more interested in exporting electricity from burning coal, the dirtiest fuel of them all. Montana would need upgrades in transmission lines to bring either wind or coal power to market.

There may be reason to think that renewables can produce much more energy that most people think. Windmills are here, geothermal is ready and new large-scale solar projects may be the most promising of all, if obstacles can be overcome:

Wind: The Stateline Wind Project, developed by Florida Power and Light and marketed by Pacificorp, is under construction near Walla Walla. It would have been the biggest wind project in the country, but had to be scaled back to protect habitat for the ground squirrel, a threatened species in Oregon. It will still be the biggest in the West. The Bonneville Power Administration plans to sign contracts to buy another 800 megawatts of wind power.

Geothermal: This still-promising resource is moribund in the Northwest, despite strong interest among developers. A significant geothermal reserve at Newberry Crater in Central Oregon could supply enough electricity to light Seattle, but after years of talk nothing has happened. In the early 1990s the BPA lost $9 million on one project at Newberry after the developer couldn’t find water that was hot enough. A different developer found an abundant reservoir of sufficiently hot water in another area near the crater, and in 1999 Portland General Electric and Eugene Water & Electric Board agreed to buy the power. But the Oregon Public Utility Commission wouldn’t even allow a hearing on the merits of the proposal, bowing to the wishes of environmental and consumer activists who were demanding a greater say in siting renewable projects, and despite significant potential benefits for the region’s economy, consumers, salmon, air quality and global climate. The BPA, meanwhile, has thrown support behind two proposed geothermal projects in Northern California, but conflicts with Native American cultural traditions and the threatened northern spotted owl could block them.

Solar: Stirling Energy Systems, of Phoenix, Ariz., has plans that could radically change the prospects for large-scale solar development, long considered not feasible. The best sites are in Nevada, but promising sites can be found in the southeast corner of Oregon and elsewhere. Called “concentrated solar power,” the new technology could produce enormous quantities of electricity. Demonstration projects could go online in Nevada and Italy next year. In the Northwest, a culture of home-grown solar energy is emerging, with help from new programs like the Bonneville Environmental Foundation. The Shakespearean Festival in Ashland, Ore., and homes and businesses on Orcas Island, in Washington’s San Juan Islands, are examples of people meeting a portion of their electrical needs themselves.

Utility investments in conservation, always small, have shown an extreme dropoff in the last six years. After 1994, the region dismantled many of its programs. A regional energy plan crafted in 1991 called for 1200 megawatts of savings over the next decade, but the region saved only 700 megawatts - still enough to power all of Seattle, but only 59 percent of the goal. If the region had reached its target, the energy crisis of 2001 might have been averted, saving numerous jobs and avoiding the destruction of countless migrating salmon. In the future, breakthroughs in industrial efficiency and a renewed commitment to conservation could still save huge amounts of electricity, but the window of opportunity will not stay open long. At today’s prices, the region could reduce electricity consumption another 2000 and 2400 megawatts without asking anyone to scale back their activities, according to the best existing estimates, now six years old. Utilities and public agencies have cut energy planning programs, and as a result have no idea how much energy could be saved. For industry, there's promise in the area of developing more efficient machines, as inventor Jerry Lamb of Port Angeles, Wash., has shown (see story).

Whether we can summon the political will to make that happen is another question. TRhe energy shoices we make today may well secure our children's future, or seal their fate.