A Bad Deal for the Environment

The Governor has justified his May 4, 2009 settlement with Sunflower Electric Power Corporation primarily on two premises. First, and most importantly to the Governor, the settlement broke the impasse in the Kansas legislature and allowed passage of measures (HB2369) that will promote the use of renewable energy resources in the state. Secondly, the settlement is subject to conditions whereby Sunflower and partners would “offset” a substantial portion of the carbon dioxide emissions from the proposed 895 megawatt (MW) coal-fired power plant, Holcomb 2. The purpose of the fact sheet is to assess the validity of these premises and associated claims.
Brief Summary

  • Renewable Energy Standard Act overstates benefits.
    • actual standard by the year 2020 would be 18.2% renewable energy not 20%
    • the act is essentially unenforceable
    • major utilities had already agreed to 20% renewable energy in 2020 with former Governor Sebelius
  • Net Metering and Easy Connections Act contains loop holes
    •  exempts electric coops like Sunflower
    • does not apply to western Kansas service areas with best wind and solar resource
    • total capacity capped at about 67 MW compared to existing Kansas utility generating capacity of 11,000 MW user credits erased at year end
  • Restricts KDHE Secretary’s authority & opens up Kansas to more coal plants
  • Allows Sunflower Electric to exempt itself from KCC rate regulation
  • The Agreement Offsets, at best, only 15% of the new coal plant’s 6.7 million tons per year of carbon dioxide greenhouse gas emissions o incorrectly calculates carbon offset values
    • counts retirement of two existing plants that Sunflower has not used for 20 years
    • counts a plan to burn biomass that is highly unlikely to be technically or economically feasible counts “reasonable efforts” to develop the highly experimental bio-energy center and algae reactor technology gives escape clause for half of energy efficiency expense.
  • The only valid offsets are some extra wind power capacity and modest gains from energy conservation.
  • New transmission lines are modestly useful, but they go to the West, not to the East where the principle market for Kansas power lies.
  • Requires tighter emission standards for the existing 350 MW coal plant, Holcomb 1
  • Settlement agreement contains several escape clauses

Conclusions.

The Governor’s deal is unlikely to materially boost renewable energy on Kansas. The Governor has vastly exaggerated the value of greenhouse gas offsets. Enforcement of the agreement will be tenuous. The few good provisions in the agreement are overwhelmed by the bad.

Introduction to the Sierra Club Fact Sheet on the Governor’s Coal Plant Agreement with Sunflower Electric
by Craig Volland, Chair, Air Quality Committee, Kansas Chapter, Sierra Club

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