EPA guidelines to cut pollution from coal burning power plants will ultimately add up to additional costs for consumers. Talks about what needs to be done and how much it will cost has industry experts and members of the Illinois Commerce Commission scratching their heads. The exact cost of closing or retrofitting coal plants and upgrading transmission lines isn’t clear but consumers will likely pay for it.
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Cutting pollution is a mandate set to happen in two stages. The first – reduce toxic air emissions linked to coal and oil burning beginning in 2012. The second stage calls for better handling of coal combustion residuals, with a compliance preparation period to begin in 2013 and full compliance by 2015. In a recent presentation to the Illinois Commerce Commission, John Bear, chief of the Midwest Independent Transmission System Operator, which is the transmission service for utilities such as Ameren, was concerned about the short time frame given to the industry. He estimates that for MISO to come into compliance, $33 billion in capital investments must be made. At the same time MISO would see reduced reserve margin levels and increased energy costs and volatility. Looking at preliminary plans, MISO would likely have to take 61 GW of resources off line simultaneously.
Besides those that deliver the electricity, like MISO and PJM, utility companies have concerns. ComEd, which serves the Chicago area and Northeastern Illinois, says some of their coal units will have to go dark, resulting in a loss of 925 MW. The company has begun upgrades at some locations, such as the Fisk plant that serves the Chicago business district. ComEd has spent $96 million in upgrades there in hopes of making up for future losses as other coal generation plants go offline.
Members of the ICC say they understand the environmental benefits of eventually doing away with coal, but some say it’s a case of the federal government putting legislation ahead of planning and engineering.