The re-election of President Barack Obama and his commitment to address global warming may play into a decision the utility will make this month about the future of such facilities.
Idaho Power is conducting an analysis of whether to invest $500 million or more in pollution-control equipment for three coal plants in Wyoming and two in Nevada. Idaho Power doesn't operate the plants, but it is a one-third owner of the Jim Bridger coal plants near Rock Springs, Wyo., and half-owner of two plants near Valmy, Nev.
The power company must decide whether to put its money into aging plants in other states, into new plants or into energy conservation - and Idaho conservationists are lobbying for that money to be invested in Idaho.
President Obama said in his second inaugural address that he would use the Environmental Protection Agency's authority under the Clean Air Act - upheld by the U.S. Supreme Court- to reduce the carbon emissions that power plants are allowed to produce. These emissions have been linked by scientists to global warming.
The coal plants Idaho Power uses also have to upgrade environmental controls on pollutants ranging from sulfur dioxide and nitrogen oxide to mercury and fly ash.
COMPARING THE COSTS
Idaho Power has a contractor studying the costs of upgrading the coal plants vs. the costs of building a new natural gas plant. The investor-owned utility that serves nearly 500,000 customers across Idaho and eastern Oregon depends on coal for 40 percent of its generation.
Already, the coal plant in Boardman, Ore., that Idaho Power owns with Portland General Electric is scheduled to shut down in 2020. The low price of natural gas has prompted many utilities to close coal plants instead of spending millions on upgrades and pollution controls, costs that are passed directly to customers.
"For now, we believe the key is to remain flexible; that will allow us to respond to future requirements if or when they're implemented," said Mark Stokes, Idaho Power's power supply planning manager.
Ben Otto, an attorney who follows the issue for the Idaho Conservation League, said that in talks with Wyoming and other states, the EPA has been tough.
"The trend I've seen with EPA's decisions is they've generally become more stringent and required the investments earlier," Otto said.
If Otto is right, the more extensive and expensive pollution controls demanded for coal plants would make their power uncompetitive with alternatives like natural gas.
And that doesn't take into account the regulations to reduce greenhouse gases like carbon dioxide that the Obama administration said it would develop that could dramatically increase the cost of plants like Jim Bridger.
BALANCING THE NEEDS
Increased energy efficiency and new gas-fired power plants are helping the Northwest keep up with the retirement of coal plants, the Northwest Power and Conservation Council reported. Idaho Power is forecasting reduced load growth over the next few years, just like the rest of the Pacific Northwest.
"This will take some of the pressure off if some coal plants are retired," Stokes said.
Wyoming plants burn Wyoming coal, but power from the Nevada plants is more costly because the coal has to be shipped from mines in Utah and elsewhere. Stokes said there also is more uncertainty for the Nevada plants because Wyoming has been negotiating with the EPA and has a clearer picture of what upgrades might be needed.
The Bridger power plants in Wyoming are the largest emitters of greenhouse gases in the state, with nearly 13 million metric tons of carbon dioxide annually, the EPA said.
Idaho Power's coal study, called the Environmental Compliance Cost Study, will be filed with the Idaho and Oregon public utility commissions in mid-February as part of the utility's update to its 2011 Integrated Resource Plan.
The power council analysis assessing the regional power supply five years into the future showed that the system would have adequate power through 2017 as long as electricity supply increases by no more than the output of a medium-size natural gas-fired plant, or by an equivalent amount of improved energy-efficiency.
The council report also said there was more than enough power to cover the loss of the coal plants, should they be shuttered.
"Of course, the future is uncertain and plans can change, as can demand for electricity," Council Chairman Bill Bradbury said. "But based on the best information we have at the moment, the risk of power outages caused by inadequate supply is acceptably low as long as current plans are fulfilled."
Otto said Idaho Power doesn't have to automatically replace the retired coal plants with a new natural gas plant. Energy efficiency and renewable energy also should be considered, he said.
Stokes said that decision would come through the Integrated Resource Planning process.
"The first question should be: What's the most cost-effective way to meet people's energy needs?" Otto said. "The second thing is: Are we going to invest in Idaho's energy infrastructure instead of investing in Wyoming's infrastructure?"
David Hawk, the former head of J.R. Simplot Co.'s energy division, sits with Otto on the Resource Plan advisory board and is a strong supporter of energy efficiency. He's glad Idaho Power is looking at the issue.
But he reminds customers that they still must pay the "stranded costs" - Idaho's Power's lost investment in the coal plants if they're closed - along with the costs of new power facilities. That means paying off the closed plant as well as for the new plant.
"You and I are going to pay for two plants," he said.
Rocky Barker: 377-6484