Legalectric

(really, that’s their “site plan” — how informative!!)

It’s in the news, Concerned River Valley Citizens’ suit against LS Power, Lent Township and Chisago County had a hearing last week.   Short version:

Judge Hoffman said he wanted to be armed with sufficient information to make a decision. He asked for just one thing – a written transcript of the legislative discussion that preceded the adoption of the legislation regarding the tax exemption in 2009, specifically subdivision 92 pertaining to the obtaining of the development agreement.

He asked the attorneys to write a letter to the court when it is provided and then he will make his decision.

The judge believed this information is important and he can’t be obligated to make a decision until he knows what the legislation said about approval of a development agreement “before” the start of construction.

Most committee meetings now are available online, and the legislative library provides tapes.  One problem is that the legislative intent is rarely conveyed in the committee meetings, and all the behind the scenes doings aren’t going to see the light of day.

The statutory section at issue – Minn. Stat. 272.02, Subd. 92.

Here’s the Summons and Complaint from last June:

CRVC -Summons and Complaint

For more info, go to www.stopsunriseriverplant.com

From ECM Post Review:

Judge asks for one thing in power plant civil case

Wednesday, 06 October 2010

By MaryHelen Swanson

In courtroom 202, Tenth Judicial District Judge John C. Hoffman heard from attorney Douglas Sauter of Barna, Guzy & Steffen, Ltd., representing the CRVC and Carlson, and three attorneys representing Chisago County, Lent Township and LS Power (Sunrise River Energy) respectively.

The CRVC and Carlson have filed a civil lawsuit against the three entities named above in connection with the siting of an electric generating power plant in Lent Township.

The attorney for Chisago County, separately retained, explained to the judge the proposal by LS Power and the coalition’s argument that there is no pre-emption to county zoning ordinance. The county’s attorney says there is pre-emption.

The attorney showed the judge the legislation enacted in 2009 that required a development agreement and host agreement before tax exempt status is granted.

The attorney said in his opinion, the county, as well as Lent Township, did nothing wrong, it was what they needed to do.

The CRVC and attorney believe that the cart has been put before the horse and argues that the sequence of events is wrong.

Attorney Sauter provided Judge Hoffman with background on the proposal, which has LS Power constructing a 780 MW natural gas-fired electric generating plant on 40 acres in Lent Township, property adjacent to the substation off County Road 14.

Giving details of the LS Power proposed project, Sauter told the judge the presence of such a large plant would destroy the nature of the community and Carlson’s ability to sell high end lots in his nearby development.

The process, he stressed, is important.

Read the rest of this entry »

An “ignition event” in the coal hopper, more commonly called an explosion and fire… Three firefighters on the scene were injured when it blew after they arrived.

This’ll be old news, but I’ve been incommunicado for a while, lost in the mountains of the Northwest, where there is no cell, no internet… what a concept!

Photo by Bill Klotz, Finance & Commerce (Fair Use!)

An interesting quote:

“I would say it’s pretty significant,” said Behnken, gesturing toward the Black Dog plant from a nearby park. Though reporters were not allowed closer access to the plant, it was apparent from a distance that the explosion’s force far exceeded initial references to it as a small explosion in a coal bin.

Here’s some video from KARE 11 with shots of the exterior damage:

In the St. Paul Pioneer Press:

3 firefighters hurt in blast at Xcel Energy coal plant in Burnsville

Workers noticed smoldering coal bin

By Emily Cutts and Deepta Holalkere
Pioneer Press
Updated: 09/21/2010 11:47:43 PM CDT

Three Burnsville firefighters were injured Tuesday morning at a power plant fire and explosion that shook local residents out of bed.

The fire started in a smoldering coal bin at Xcel Energy’s Black Dog power plant in Burnsville, the company said. As fire crews tried to extinguish the flames, a blast in the bin rocked the plant.

Two of the firefighters were treated at the scene for minor burns and returned to fighting the fire. A third was taken to Regions Hospital in St. Paul with a leg injury, said Burnsville police Sgt. Jef Behnken.

“I heard a boom and then a bigger boom,” said Nancy Caneff, who lives nearby. Caneff was in bed when the blasts — the second strong enough to shake her bed — happened.

Firefighters put out two relatively small fires at the plant by 2 p.m. Tuesday but remained on site through the afternoon to handle hot spots, Xcel spokesman Tom Hoen said.
Read the rest of this entry »

A couple of days ago, a little birdie sent me an uplifting article, and what I like most about it is the use of the term “boondoggle,” which is the definition of Minnesota’s “own” Mesaba Project:

For Carbon Capture, DOE Moves Oxycombustion Ahead of IGCC

If IEEE’s Spectrum is using that term, the rest of the world can’t be far behind!

We’ve been having quite a few go-rounds about Mesaba lately, since Iron Range Resources unilaterally decided to significantly and substantively alter the “contract” for the $9.5 million in funding.   I’d started a post on that and can’t find it for the life of me, so here we go… Now remember, this is not including the state’s Renewable Development Fund money or the DOE’s money thrown at this project, this is “only” the state IRR’s money, $9.5 million, and the interest on that “loan” is 20%:

MCGP Exhibit 5023 – IRR & Excelsior Convertible Debenture Agreement

You’ll find that interest rate on p. 12, 20% simple interest per annum on the outstanding principal.  Since they’ve paid nothing on it except the $40k that they were found to have spent improperly (with many other issues not addressed because the IRR had “destroyed” documentation… yeah, right…), 20% simple interest per annum on a “loan” from 2004 means that there’s another $8,000,000 due now.  And this does NOT take into account the initial $1.5 million from IRR, it’s just the agreement above.

And as noted above,  a couple of weeks ago, it seems the IRR unilaterally decided to significantly and substantively alter the “contract” … based on exactly what???

Here’s how Commissioner Sandy Layman characterized the predicament:

The principal balance owed by Excelsior Energy, Inc. to Iron Range Resources under the
existing loan documents is $9,454,962.

No mention is made of the more than $10 million in interest.   Nada…

Here are two of Aaron Brown’s posts:

Excelsior Energy to seek huge break from Iron Range Resources

… and …

This Iron Range blogger is done apologizing for Iron Range cronyism

Here’s Charlotte Neigh’s editorial, published in the Grand Rapids Herald-Review and on the Citizens Against the Mesaba Project site:

IRR WRITES OFF $ MILLIONS OWED BY EXCELSIOR ENERGY

By failing to declare Excelsior Energy in default, which would put an end to the Mesaba Energy Project, the Iron Range Resources Board is enabling Excelsior to draw down the remaining $2.3 million of Department of Energy funding, which can continue to provide handsome salaries for Tom Micheletti and his wife and co-president, Julie Jorgensen.

In April 2007 Excelsior Energy defaulted on its $952,376 interest payment on loans from IRR and it hasn’t paid any interest yet. Since then interest has been accruing on $9.5 million at the rate of 20% per year and the annual payments should be about $2 million. In addition, Excelsior was supposed to pay $800,000 per year on the principal, starting in December 2009, which it also failed to do. After repeated extensions of the due date, payment was supposed to be made by December 2010.

However, at a non-public meeting on August 10th, an IRR committee discussed Tom Micheletti’s proposed changes to the terms of the loans and the IRR Board rubber-stamped these amendments at its meeting on August 19th. From the limited information available, it can be determined that: the annual principal payment will start in December 2010 and will be reduced from $800,000 to $100,000; the interest will be calculated at the reduced rate of 5% instead of 20% and annual payments are not required; and if Excelsior pays off the entire principal by 12/31/17, the interest rate will be recalculated at 3% per year. This amounts to a loss of revenue to IRR well in excess of $10 million, in addition to the $9.5 million that probably never will be repaid.

The high initial interest rate reflected the risk level of the Mesaba Energy Project, which has been borne out by Excelsior’s failure to attract investors or customers. This is despite having spent nearly 40 million public dollars, including approximately $20 million from the federal Department of Energy and $10 million from Minnesota’s Renewable Development Fund, in addition to IRR’s $9.5 million. Tom Micheletti did not offer the IRR Board any revised plan for making this project succeed. When the remaining $2.3 million is gone, Excelsior can declare bankruptcy without assets to repay its creditors, and its co-presidents can walk away.

Micheletti touts the accomplishment of a final environmental impact statement but that process has not been finished because it still lacks a Record of Decision by the DOE. Micheletti touts the accomplishment of having the site approved by the Public Utilities Commission but fails to mention that the project cannot proceed without required regulatory permits. The air permitting has been delayed since 2006 and is problematic because this project is competing with mining operations that can’t be located elsewhere for scarce space for more pollutants in the airshed.

Sensible people must wonder why the IRR Board would do this, or why it would have funded this project in the first place, or why it would have waived the requirement for matching funds, or why it would have extended the due date for payments while it continued throwing good money after bad. A likely factor is the generosity of Excelsior insiders at campaign fundraisers for some of these legislators the week before the committee meeting and over recent years.

FEIS NOT ACTUALLY “FINAL”: AIR AND WATER PERMITS LACKING

The final step for the environmental impact statement (issued in November 2009) is a “record of decision” (ROD) prepared within the DOE, vouchsafing that all has been done thoroughly and properly and the project should be allowed to proceed with DOE support. However, the ROD has been delayed and the monthly reports indicate “schedule uncertain”. We don’t know all of the reasons for this but they may include concerns previously raised by the EPA, the Army Corps of Engineers and the federal land managers. One of the known reasons is Excelsior’s failure to acquire the necessary air and water permits from the Minnesota Pollution Control Agency (MPCA). Apparently Excelsior continues to qualify for cost-sharing contributions from the $22 million DOE fund ($2.3 million remaining) while it pursues these permits.

Excelsior is not actively pursuing water permits at the MPCA; if there have been any changes since the June 2006 applications, revised applications will be required. In late spring Excelsior contacted the MPCA regarding the air permits and work is currently underway to determine what updates to the 2006 applications will be required. It appears that no draft permit will be issued in the foreseeable future and if one ever is, it can be appealed to the EPA, a process that could take 18 months.

.

As inevitable as the tide, the Minnesota winter snows, mosquitos, death and taxes…  This is way too predictable!  Charlotte Neigh, of Citizens Against the Mesaba Project, is dead on again with her trajectory of Excelsior Energy’s weaseling out of their financial responsibilities in this Mesaba Project boondoggle.  A deadline is approaching where Excelsior Energy has to make a payment on its financing from the Iron Range Resources Board:

MCGP Exhibit 5023 – IRR & Excelsior Convertible Debenture Agreement

A little birdie just sent this, literally hours after Charlotte had mentioned that the next payment was coming due and wondering what they were going to pull this time to get out of it (it’s ALWAYS something):

Published August 18 2010

Excelsior asks for more time to repay Iron Range loans

Excelsior Energy’s plans to build a coal gasification power plant known as the Mesaba Energy project on the Iron Range have suffered numerous delays.

By: Steve Kuchera, Duluth News Tribune

The Iron Range Resources Board will consider a request Thursday to give Excelsior Energy more time to pay back nearly $9.5 million in loans.

Excelsior’s plans to build a coal gasification power plant known as the Mesaba Energy project on the Iron Range have suffered numerous delays.

“Development plans originally contemplated that the project would have been under construction prior to 2010 and repayment would have begun,” IRR Commissioner Sandy Layman wrote in a memo to board members requesting the extension of the loan and delay in interest payments. “Sufficient funds are not available to meet repayment requirements under the existing loan terms at this time.”

The IRR has two outstanding loans with Excelsior: one for $1.5 million approved in December 2001 and one for $8 million approved in June 2004. Excelsior has paid back $45,038 of the loans’ principal.

If approved, the new loan agreement will require annual principal payments of $100,000 due Dec. 31 beginning this year and running through 2017. Interest on timely payments will be figured at 5 percent for the preceding 12 months. With IRR approval, Excelsior can repay all outstanding principal before Dec. 31, 2017, at a reduced interest rate.

In exchange, Excelsior would agree to pay the IRR 5 percent of the proceeds from any sale of equity in the Mesaba Energy project in excess of Excelsior’s liabilities from the project.

There’s been change afoot as the facts of the infeasibility of CO2 capture and storage filters up to the higher regions of the cesspool, and as the financing nightmares and high capital costs of IGCC are paraded in public as the Indiana Duke IGCC project moves forward, and as, of course, the DOE’s EIS (here’s the DOE’s project page) for Excelsior Energy’s Mesaba Project drags on and on and on as the agency refuses, thankfully, to issue the Record of Decision on that… and slowly, painfully slowly, the truth about this IGCC pipedream is coming out.

A few telling tidbits, first, that they’ve given up on FutureGen IGCC, YEAAAAAAAAA:

DOE to provide $1B to revamped FutureGen

Katherine Ling, E&E reporter

The Energy Department today announced $1 billion in stimulus funding for a carbon capture and sequestration retrofit project it is labeling “FutureGen 2.0.”

The new project would retrofit a mothballed unit of an Ameren Energy Resources coal-fired power plant in Meredosia, Ill., to capture 90 percent of carbon dioxide and other pollutants using “oxy-combustion” technology, and then transport and sequester the CO2 in a regional storage site in Mattoon, Ill. The Mattoon location — the site of the original FutureGen project — would also house a training facility to teach oxy-combustion technology and retrofitting skills.

DOE is providing the $1 billion to the FutureGen Alliance, Ameren, Babcock & Wilcox and Air Liquide Process & Construction Inc. to develop the facility. The total cost of retrofitting the plant and building a “collection facility” for carbon dioxide, a training facility and CO2 pipelines will be about $1.13 billion in federal investment, with the expectation of up to $250 million in private investment, Sen. Dick Durbin (D-Ill.) told reporters. Durbin has been a strong advocate for the project and repeatedly requested appropriations for it.

The project would be a significant change from the original FutureGen clean coal project announced by President George W. Bush and DOE in 2003. The original project supported by DOE and the FutureGen Alliance — a consortium of major coal and utility companies — aimed to build a new coal power plant on 444 acres in Mattoon that would use integrated gasification combined cycle (IGCC) technology, produce hydrogen and electricity, and capture and sequester CO2. Bush and then-Energy Secretary Samuel Bodman announced in 2008 that they were walking away from the project because of skyrocketing costs (Greenwire, June 12, 2009).

“Today’s announcement will help ensure the U.S. remains competitive in a carbon-constrained economy, creating jobs while reducing greenhouse gas pollution,” Energy Secretary Steven Chu said in a statement.

“This investment in the world’s first, commercial-scale, oxy-combustion power plant will help to open up the over $300 billion market for coal unit repowering and position the country as a leader in an important part of the global clean energy economy,” Chu added.

Oxy-combustion technology utilizes oxygen and CO2 instead of air to produce a concentrated CO2 stream for safe, permanent storage, DOE said. The technology also eliminates almost all of the mercury, SOx, NOx and particulate pollutants from plant emissions and could be potentially the lowest-cost approach to clean up existing coal-fired facilities and capture CO2 for geologic storage, according to the National Energy Technology Laboratory.

“It really didn’t make any sense to prove a technology that has already been proven” and move forward with IGCC, Durbin said. “I think this is going to build way beyond the original FutureGen concept.”

Durbin said the plan is to conduct engineering and land acquisition this fall and start on construction next spring.

The construction of the pipelines, facilities and retrofit will create about 900 jobs in southern Illinois and another 1,000 jobs at suppliers across the state, according to DOE.

This study was released last June, which shows that leakage of CO2 is a major problem, and which makes sequestration not feasible:

Long-term Effectiveness and Consequences of Carbon Dioxide Sequestration – Shaffer

Can’t have information like that getting out, so USA Today, of course, plays it with the following headline — DUH, of course critics pan the study — and this is the best they could come up with and it took two months!

Critics question carbon storage study

Worries about leaks from buried greenhouse gasses unearthed in a recent climate study look overblown, say critics.

Carbon sequestration, burying carbon dioxide in underground reservoirs, has emerged in recent years as one option for continuing to burn coal and other fossil fuels from power plants while addressing global warming. A 2004 Science journal report by Princeton researchers, for example, pointed to carbon sequestration as one strategy, among many, for humanity dodging the climate consequences of pumping global warming gases into the atmosphere.

A June Nature Geoscience report by Gary Shaffer of the Danish Center for Earth System Science, however found such carbon dioxide reservoirs would have to leak less than 1% per millennium to help the climate. “The dangers of carbon sequestration are real and the development of (carbon sequestration) should not be used as a way of justifying continued high fossil fuel emissions,” Shaffer said in a statement, alluding to a debate over whether “clean coal” power plants, which would store their greenhouse gas emissions underground, are a worthwhile goal for addressing climate change.

The study made news in climate circles, but some have since pointed out problems with Shaffer’s study. “I feel that this calculation adds little to the question of whether we should use carbon capture and storage,” wrote Nature assistant news editor Richard Van Noorden, suggesting that researchers need to figure out whether carbon can be safely pumped underground in the first place before worrying about 20,000 years from now, an end point of the study.

This month, an Energy Department analysis from the Pacific Northwest National Laboratory (PNNL) of the study found “two deeply flawed assumptions which combine to grossly overstate the impacts associated with society using carbon dioxide capture and storage.”

First, the Nature Geoscience analysis suggested that carbon sequestration would be used to bury enough greenhouse gas to stave off all future climate warming. At best, carbon sequestration could store only about half of the carbon dioxide emissions responsible for global warming, notes the PNNL critique, and likely much less. And those carbon dioxide emissions are only partly responsible for projected future average surface temperature increases (anywhere from 2 to 11 degrees Fahrenheit depending on actual emissions, according to March National Research Council reports) alongside deforestation, and other greenhouse gasses:

“The assumption that (sequestration) is the only mitigation technology available is therefore highly questionable as a simplifying assumption as it leads to a dramatic overestimation of the amount of CO2 required to be sequestered. This significant overestimation of CO2 stored leads directly to the enormous volume of leakage and the resulting harm from imperfect retention reported by Shaffer.”

Second, the whole point of carbon sequestration underground is that the carbon dioxide would chemically bind to the rock layers there, preventing it from leaking, over decades and centuries.

“My study was not meant to propose if and how much (sequestration) to use but rather to look for the first time at the long term consequences of any leakage back to the atmosphere of any CO2 sequestered,” Shaffer says, by email. “My results show that high emissions with (sequestration) is not the same as low emissions without (sequestration) because of the leakage and its consequences.”

But the amount of sequestration contemplated in the study is “off by at least two orders of magnitude,” says MIT’s Ruben Juanes. “I’m as skeptical of carbon sequestration as anyone — the energy penalty it incurs is substantial — but the assumptions made in this (Nature Geoscience) paper are very hard to justify.”

Princeton’s Michael Celia, another sequestration researcher, notes that research already shows that 95% of any carbon injected into a reservoir would become trapped within 1,000 years. “In general I agree with the PNNL comments,” Celia says, by email.

Carbon sequestration critics often make over-sized assumptions about the technology to write it off, Juanes adds, such as objecting to the amount of pipe needed to immediately equip every existing power plant in the nation with it, making a one-time purchase out of an economic process that would play out over decades. “No single technology can immediately bridge the gaps in climate,” Juanes says.

By Dan Vergano