Ark. Coal Plant Moving to Next Phase

After almost two months of testimony and a visit to Hempstead County, where the plant would be built, the PSC began hearing closing arguments Monday on whether it should approve construction of the plant. A decision is due within 60 days.

SWEPCO was scheduled to go last among four 30-minute spots on the agenda. The utility is defending its proposal to build a 600-megawatt plant on 2,875 acres that landowners and hunters say will degrade air and water quality and damage virgin cypress swamps.

Rick Addison of Dallas, attorney for the opponents, said SWEPCO has not adequately studied other options for providing electricity and has selected a site that its own reviews rank low on suitability. More importantly, he said, the "ultra supercritical technology" is not much improvement over technology used in the 19th century and does nothing to address the impending threat of global warming.

"The days of pulverized coal are over. Commissions around the country are rejecting them," Addison said.

Commission Chairman Paul Suskie asked Addison what could be done in the interim if the panel rejects the project. Addison replied that he didn't have an answer to what might be the best alternative technology, but said SWEPCO should be required to study those alternatives and demonstrate that a coal-fired plant would be the best technology to use.

Addison also said that health costs and costs to the fishing industry should be considered in determining the overall costs to the state in allowing a new plant. He predicted that SWEPCO would return to the PSC seeking a rate increase if the project is approved because, he said there has been no analysis of its financing method.

In addition to plant opponents and SWEPCO, the PSC members were to hear from the state attorney general's office and the PSC staff.

The PSC must decide if the project is "environmentally compatible" with its surroundings while serving the public's needs: if the plant technology would be efficient and if the environmental damage caused by the plant would be acceptable when weighted against the pluses of providing electricity.

SWEPCO still must obtain permits from the Arkansas Department of Environmental Quality and approval from regulators in Texas, where SWEPCO also has customers. An economist for the Texas regulators has said the plant should not be built.

In Arkansas, opponents cite the well-documented contribution of coal-fired plants to environmental pollution, including carbon dioxide, the chief culprit in global warming; nitrous oxide, which produces smog; sulfur dioxide, which causes acid rain; mercury and particulate matter.

SWEPCO and its parent company, Columbus, Ohio-based American Electric Power, say the plant will meet both state and federal requirements and be capable of modifications if new federal laws impose further safeguards in light of the climate change debate. The project has the backing of the PSC staff, which says SWEPCO's proposal meets all the legal requirements, and SWEPCO also has obtained approval from the ADEQ to begin some site preparation.

SWEPCO says the project will be a boon to economic development, and the PSC has already agreed that the utility needs more capacity to meet a nearly 2 percent increase in demand each year among its customers. With the new plant, Arkansas customers of SWEPCO would see their bills rise about $8.50 a month.

The utility estimates it will have 110 full-time workers once the John W. Turk plant is operating near Fulton, and an annual payroll of $12 million. The Shreveport, La.-based company would share ownership of the plant with three other utilities. SWEPCO would own 73 percent.

Company attorney Stephen Cuffman says opponents simply don't want the plant in "their backyards."

In a filing last week, the attorney general's office said the plant "is not in the best interest of the ratepayers from an economic standpoint" unless the PSC requires SWEPCO to agree to certain terms. Arkansas ratepayers should not be "harmed" financially if, for instance, Texas regulators don't approve the SWEPCO plant, a co-owner or a wholesale customer drops out of the deal, or the costs to control carbon dioxide emissions exceeds predictions.

Other state agencies also have raised concerns. Arkansas heritage officials say there may be a potential threat to American Indian burial sites and to the nearby Trail of Tears, and the Arkansas Game and Fish Commission says mercury emissions from the plant are a potential threat to fish in waterways in the region and mercury levels will need to be monitored.