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October 15, 2008
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Karn-Weadock electrical generating complex of Consumers Energy at mouth of Saginaw River awaits air quality permit for expansion. Only Air Quality Permit Delays Consumer Energy Expansion, New Midland Plant
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Legislation that is vital to the economy of the tri-county area is now law.
The only hold-up in moving ahead with the key projects, expansion of the Karn-Weadock electric generating complex of Consumers Energy, and a new power plant in Midland, are in the bureaucratic realm.
And, it appears that the best guess is that the air quality permit that Consumers seeks for a proposed 800 megawatt clean coal plant will take at least a year, according to the experience of other companies with recent applications.
The application is going through the processes required by the Michigan Department of Environmental Quality (DEQ). The DEQ is weighing Consumers plans to reduce harmful emissions by more complete combustion of pulverized coal that will fuel the new plant.
A new $1.9 million 750 megawatt Midland plant proposed by LS Power and Dynegy is also in line for an air quality permit. Construction of that plant also would greatly boost the tri-county economy, especially in the approximately five year construction period.
Approval of the new plants here and another application for a plant in Rogers City would be the first new coal fired plants since 1984 --nearly a quarter century ago. The facilities are sought to meet growing energy demands in Michigan.
The state has about 3,500 megawatts of generating capacity in electric plants, averaging nearly 50 years old, that are expected to be outdated by 2025.
Consumers has already pushed back the projected start on the plant expansion by a year, until 2010, with anticipated date for the facility to come on line in 2015.
Gov. Jennifer Granholm has signed into law a package that will require more electricity to come from renewable sources, raise residential rates, restrict competition among power companies and encourage energy efficiency. Granholm had bill-signing ceremonies in Detroit and in Eaton Rapids.
She said the new measures will create new renewable energy jobs. Among other provisions, the package requires that 10 percent of Michigan's power come from renewable sources by the end of 2015. More than half of U.S. states already have such requirements or goals.
Workers at Dowding Industries in Eaton Rapids looked on at a new manufacturing plant as she signed the bills. Dowding President Jeff Metts said the factory will build components for wind turbines.
Granholm said: "Clearly, we'd like to have a stronger one (requirements for renewable energy production) eventually." She added that many states that started with lower requirements "have gone back and upped it," in other words strengthening renewable provisions.
Residential energy rates are expected to rise as a result of the new law. The state's largest utility, DTE Energy, estimated a typical resident may pay an extra $12 to $15 a month for electricity within five years. Consumers Energy, the second-biggest utility, estimated an average resident may pay $6 to $7.50 more.
Supporters said residential bills would have gone up more if the Legislature had not passed the bill. They assert that Michigan now is assured of reliable, cleaner power and won't need to build as many coal-fired plants.
Businesses and schools that historically have subsidized residential costs will see their rates drop.
The package guarantees DTE and Consumers Energy 90 percent of the electric market. The utilities said they needed certainty of market share in order to qualify for financing for new, expensive power plants to meet demand and replace aging plants.
However, critics said limiting choice will lead to higher rates.###
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