Legalectric

Coal is a risky business… So now it’s not just Wall Street saying that coal plants are not a good investment, it’s not just the DOE’s IGCC program saying that IGCC is too risky for private development, now the federal Rural Utilities Service is saying that funding for coal plants will be STOPPED. Yes, that’s right, STOPPED! They’ve suspended RUS coal plant loans, “saying the uncertainties of climate change and rising construction costs make the loans too risky.”

The program’s suspension marks a dramatic reversal of a once-reliable source of new coal plant financing. It follows the announcement last month that several major banks will require plant developers to factor in climate change when seeking private funding.

“This is a big decision. It says new coal plants can’t go to the federal government for money at least for the next couple years, and these are critical times for companies to get these plants built,” said Abigail Dillen with the environmental law group Earthjustice. The group filed a federal lawsuit last year seeking to block the loan program.

This is big news for those of us who want to see Big Stone II added to the list of 59-61 or so plants going down… Big Stone had RUS finding. If RUS funding is over, is Big Stone going the way of the brontosaurus?  Which of the entities in Big Stone II were in line for RUS funding, and for what?  Power plant funding or transmission funding or ???  The RUS Notice says MRES, and it’s not clear how it’s set up:

RUS Notice of EIS for Big Stone II

Can we expect the end of Big Stone II??? I sure hope so, but… Let’s keep an eye on the Big Stone II site, not that they’d be eager to issue a press release… SNORT!

Loans program for coal plants suspended

By MATTHEW BROWN
MORE FROM BUSINESSWEEK

BILLINGS, Mont.

The federal government is suspending a major loan program for coal-fired power plants in rural communities, saying the uncertainties of climate change and rising construction costs make the loans too risky.

After issuing $1.3 billion in loans for new plant construction since 2001, none will be issued this year and likely none in 2009, James Newby, assistant administrator for the Rural Utilities Service, a branch of the Department of Agriculture, said Tuesday.

The program’s suspension marks a dramatic reversal of a once-reliable source of new coal plant financing. It follows the announcement last month that several major banks will require plant developers to factor in climate change when seeking private funding.

“This is a big decision. It says new coal plants can’t go to the federal government for money at least for the next couple years, and these are critical times for companies to get these plants built,” said Abigail Dillen with the environmental law group Earthjustice. The group filed a federal lawsuit last year seeking to block the loan program.

At the time of the suspension, at least four utilities had been lined up for loans totaling $1.3 billion — for projects in Kentucky, Illinois, Arkansas and Missouri. A project in Montana was denied funding last month. Two more were recently withdrawn: last October in Wyoming and earlier this week in Missouri.

Newby said material and labor costs for new coal plants have been rising 30 percent a year, even as utilities struggle to pinpoint future costs of controlling greenhouse gas emissions. The 2 billion tons of those gases produced annually by coal-fired plants in the United States exceed the emissions of any other source.

Newby said those uncertainties prompted the White House’s Office of Management and Budget to ask that new loans be put on hold until risks can be better quantified.

Rural utilities provide power to about 40 million customers across the nation. More than 60 percent of that electricity comes from coal.

Whether the plants that were awaiting federal loans can find alternative financing remains to be seen.

Associated Electric Cooperative Inc. announced this week it was “delaying indefinitely” its proposed plant in Norborne, Mo., after receiving word of the loan program suspension.

At least one developer, the East Kentucky Power Cooperative, is hoping to wait out the suspension of the loan program rather than seek more expensive loans on the open market, spokesman Nick Comer said.

Two more projects — Southern Montana Electric’s Highwood Generating Station and Basin Electric Power Cooperative’s Dry Fork plant in Wyoming — already are seeking private funding.

A representative of the East Texas Power Cooperative, which has proposed a plant in Plum Point, Ark., also said his utility would seek private financing if the loans are not resumed.

“We’ll have to look elsewhere for funding, which will increase the interest expense, which will increase the electric bill for the consumers at the end of the line,” said the cooperative’s Ryan Thomas.

Newby, with the Rural Utilities Service, said his agency is considering imposing upfront fees on coal plant developers as a way to mitigate taxpayer exposure through the loan program. Initial discussions have centered on a 0.2 percent fee — equivalent to $2 million on every $1 billion in loans.

Newby added he was confident the government would work through the concerns over risk and resume issuing loans possibly as soon as 2010.

Glenn English, chief executive of the National Rural Electric Cooperative Association, said the program’s suspension was a sign of “nervousness” among lenders anxious over the potential ramifications of climate change legislation now before Congress.

Depending on what policies are adopted, retail electricity prices could increase sharply once the costs of reducing greenhouse gases are factored in, he said. Utilities that drop coal-fired power proposals will be forced to shop for more expensive electricity on the open market.

“What you’re seeing (with the Rural Utilities Service) is a general reflection of the attitude we find in the financial community, mainly this apprehension about what the future holds and what can be expected out of government,” English said.

Look at Excelsior Energy ad, about its doomed and bloated IGCC coal gasification disaster called the Mesaba Project, printed in the Mesabi Daily News on February 22, 2008. Why is Excelsior Energy naming Range projects “PolyMet, Minnesota Steel, Franconia, US Steel and many others…” Excelsior doesn’t have a power purchase agreement with anyone, not a one of these companies listed… EH??? What’s upwith this? What’s Tom Micheletti trying to gain by association here? Some sense of legitimacy and need for the project? HA! “… the kind of energy our Mesaba Energy Project will produce.” Oh puh-leeeeeze, what a crock…

…and yes, I know, I know it’s sideways:

Here’s the pdf version so you can turn it around and see it in all its glory — I just can’t get the damn thing to save “landscape.” Hmmmm… what does that mean… well, it is Excelsior Energy’s Mesaba Project, after all, so of course it won’t save “landscape.”

Excelsior Energy ad – Mesabi DN Feb 22, 2008

So what gives? Why are they blathering this nonsense?

WHO PAID FOR THIS?  MINNESOTA TAXPAYERS?

IGCC and coal gasification — Excelsior Energy’s Mesaba Project is the bloated and thrashed equine carcass that keeps coming back for more.  The Mesaba Project is still dead…
Whew!  That Mesaba hearing in January was such a farce… some was detailed in a previous post, foreshadowing mostly, and some more here in this post. The transcripts of it have to be read to be believed. They’re in St. Paul, as always, at the Dept. of Commerce, and they’re also, thanks to the efforts of CAMP (Citizens Against the Mesaba Project), in the libraries in Hoyt Lakes and Grand Rapids. Really, it’s worth the drive to check these out. This transcript has, in black and white, some of the most egregious examples of procedural bullshit I’ve ever seen, there really is no other term for it. It’s hard to say what sticks in my craw the most, but I’ve got a few more quotes that I’ll stick below.

I’ve been shaking my head in disbelief for almost a month now, and had to do something, this just couldn’t go unacknowledged, so once the transcripts arrived, I had a little help getting some choice quotes and had a couple of questioners of witnesses eager to do some more questioning so we filed this Motion for Extension of Hearing:

MCGP Motion for Extension of Hearing

MCGP Motion – Affidavit of Muller

MCGP Motion – Affidavit of Rich

Here are some snippets:

—————————————————–p. 20

5 JUDGE MIHALCHICK: Ms. Overland.
6 MS. OVERLAND: Is there an MPCA representative
7 here?
8 JUDGE MIHALCHICK: Is there a what?
9 MS. OVERLAND: Is there a representative of
10 the MPCA here today? MPCA, anyone?
11 JUDGE MIHALCHICK: Nobody is raising their
12 hand.
13 MS. OVERLAND: Shouldn’t they be here?
14 JUDGE MIHALCHICK: I don’t know. That’s their
15 choice.

—————————————————–p. 28-29

9 MS. OVERLAND: I have a procedural issue.
10 Carol Overland for MCGP. I have a procedural issue
11 regarding Mr. Starns’ comments early on. Mr. Starns
12 had made a specific reference to size, type and timing.
13 And under Minnesota Rule 7849.5710, Subpart 4, under
14 issues it says, “Once the Public Utilities Commission
15 has determined the questions of need, including size,
16 type and timing, questions of system configurations and
17 questions of voltage, these issues must not be
18 addressed in the public hearing.”
19 Now, the Public Utilities Commission has not
20 determined the question of need and it has not
21 determined questions of system configuration, questions
22 of voltage. So I wanted to point that out, that this
23 proceeding is exempt — their project is exempt from
24 certificate of need requirements. But there has not
25 been a determination made by the PUC about need or any
1 of these other issues.
2 JUDGE MIHALCHICK: Mr. Starns, do you want to
3 address that?
4 MR. STARNS: Your Honor, because the project
5 is exempt from certificate of need, that’s why size,
6 type and timing are not to be considered.
7 MS. OVERLAND: Your Honor, again, that’s not
8 what the rule says. It says “The PUC has determined,”
9 and the PUC hasn’t determined, they have not.
10 JUDGE MIHALCHICK: In my judgment the statute
11 exempts this project from the certificate of need
12 requirements. In essence, it seems to me that exempts
13 them also under that rule as if — so it should be
14 interrupted as if the commission had determined that.
15 If we did otherwise, we’d be bringing back in a
16 requirement that the legislature said shouldn’t be
17 there. So I think his statement was accurate, Mr.
18 Starns’ statement was accurate.
19 Any other preliminary matters?

—————————————————–p. 308

2 JUDGE MIHALCHICK: We’re going to go back on
3 the record. This is the second session of the public
4 hearings in the matter of the joint applic366ation to the
5 Minnesota Public Utilities Commission for the following
6 pre-construction permits: Large electric generating
7 plant site permit, high voltage transmission line route
8 permit, and natural gas pipeline routing.
9 We’re going to go back, essentially, to the
10 originally scheduled process of doing the Stage 1
11 proceedings at the start of today, meaning the company
12 will call its witnesses and have them testify. If I or
13 the department have any questions, we’ll take those,
14 and then when we’ve completed those witnesses, we’ll
15 move into Stage 2, the public comments and questions.
16 Mr. Starns.

—————————————————-p. 366

2 JUDGE MIHALCHICK: We’re not taking public
3 questions. We’ve changed the process. We’ve gone back
4 to the original process that we’re going to do the
5 Stage 1 portion of the applicant putting in its
6 exhibits or testimony. Then when we’re done with that,
7 we’ll take questions from the public.
8 MS. OVERLAND: Does that mean all the
9 witnesses?
10 JUDGE MIHALCHICK: That’s right. We’re about
11 halfway done.
12 MS. OVERLAND: You mean through the entire
13 list of witnesses?
14 JUDGE MIHALCHICK: Right.

So he rammed through 16 witnesses in one day, it took all day:

Applicant witnesses:

Todd Royer
Thomas Henning
George McVehil
Jeffrey Davis
John Lee
Charles Michael
Kelly Henry
Brad Kovach
Anne Ketz
Bret Johnson
David McKenzie
Robert Mantey
Stephen Sherner
Paul Young
Richard Stone
Bob Evans

In Hoyt Lakes, the gym the hearing was held in was unheated, and Mihalchick made us sit all day through introductions of all those witnesses and it was DAMN COLD, and as Alan got up to start questioning:

15 MR. MULLER: My name is Alan Muller. Before I
16 begin, I’d like to note that Mr. Micheletti is wearing
17 gloves, representatives of the Department of Commerce
18 are wearing gloves. Many people in the room are
19 wearing gloves and overcoats. I don’t know if the
20 rules of the Office of Administrative Hearings call for
21 holding public hearings in heated facilities, but that
22 might be something to consider in the future.
23 JUDGE MIHALCHICK: Nobody is suffering more
24 than I am.

————————————- p. 629-630
16 A. I’m addressing the comments we received.

17 Q. At what point will you —
18 JUDGE MIHALCHICK: I think that’s enough. I’m
19 going to have to ask you, if you want to submit
20 anything more, please do so within the next month in
21 writing. I have one person back here who seems to
22 really want to talk, but maybe not. So I’m going to
23 take some other comments now and then adjourn.
24 MR. MULLER: Okay. Well, I’d like the record
25 to show that I do have more questions for more
1 witnesses.
2 JUDGE MIHALCHICK: Thank you. It will show
3 that.

———————————————-p. 631-632

20 JUDGE MIHALCHICK: Take one more comment. I
21 didn’t mean to have cut off Mr. Muller, but I think the
22 hearing has gone long enough. We’ve got adequate time
23 for the public comment and the company. I’ve extended
24 the public comment period. I certainly invite all of
25 you to submit comments during that time. And I think
1 we’ll close. Is there anything else, any procedural
2 things to wrap up here? Thank you all for coming and
3 enjoy the rest of the winter.

Stolen from Rolling Stone 

Earth to Franken – IGCC is a pipedream!

Published today in the Bemidji Pioneer:

Commentary: Franken on guns, coal and forests

Brad Swenson Bemidji Pioneer
Published Sunday, February 17, 2008
The operative word the electorate seems to be embracing this election cycle is “change.”

And, in Minnesota, you probably couldn’t get a more obvious “change” than in Al Franken, a Democrat vying for the party nomination to run against incumbent Republican U.S. Sen. Norm Coleman.

Franken has never held an elective office, has never until recently shown an interest in organized party politics (although he hasn’t been shy about which way he leans), he’s not a lawyer or a career politician and while growing up in Minnesota, Franken was born in New York and spent most of his life in New York.

My goodness, the man’s a comedian, a funnyman — a satirist.

Yet the former “Saturday Night Live” writer and actor draws a crowd most places he gathers for meet-and-greets, including 250 people recently in a Wadena café and likewise packed a Park Rapids café.

“Once they hear me speak, they know I speak from the heart, from the head and from the gut,” Franken told me a week ago as he overnighted in Bemidji on the way to a Senate candidate debate in International Falls. He’s on the trail with Twin Cities attorney Mike Ciresi and St. Thomas University Professor Jack Nelson-Pallmeyer.

He’s visiting a lot of rural towns, especially in northern Minnesota, not so much for name recognition — thanks to his “other” career — but to drill in that he understands Minne-sota and lived in Minnesota (St. Louis Park). It’s why he’s run-ning barrage of television ads now, to solidify his Minnesota connection before anyone can tag him a “Hollywood” candidate because of his entertainment friends and their money.

“Going around, I discovered it was important for people to know I grew up in Minnesota,” he said.

Minnesotans do want to know their candidate, want to eyeball him or her in person, and want to know what they say about issues important to them. In our talk at the Green Mill, just a mention of Coleman’s role as chairman of the Permanent Subcommittee on Investigations and the war in Iraq wound Franken up for 15 minutes. And it must be touchy, as Sen. Coleman called me late last week to spend a half hour refuting all that Franken had said, quipping that Franken tells “half-truths and whole lies,” something sounding suspiciously like an Al Franken book title.

But what does candidate Franken know about northern Minnesota? Obviously, as a New Yorker, he hasn’t spent much time in the woods with a deer rifle. In fact, last fall Franken went hunting for the first time and had with him as his guide U.S. Rep. Collin Peterson, DFL-7th District, an avid hunter and founder of the Congressional Sportsmen’s Caucus.

“My briefing was, ‘Shoot this,’ and a picture of a pheasant rooster, ‘Not this — Collin,’” Franken said of the second picture of Peterson. “Mission accomplished. I shot two roosters and not Collin.”

That episode aside, Franken said people have the right to have guns for collection, protection and hunting, recreation and target shooting. “I don’t think people should have artillery,” he said with a deep chuckle.

More seriously, “I think we should just enforce the laws that we have,” he said.

Franken’s been criticized of being a little light on farm is-sues, but says he’s learning. And he says he knows of the plight of northern Minnesota’s timber industry, and hopes a niche can be found in renewable energy production from the forest.

“Ag is obviously important to this state and it’s important to this country,” he said, adding that “I’ve been consulting with Collin Peterson, as well.” Peterson is chairman of the House Agriculture Committee.

“I do think that the green economy will be very good for rural Minnesota,” he said. “And also we’re talking about renewables and energy efficiency, and creating jobs through both of those.”

He’s been asked about the Iron Range’s current build-up and the need for more energy, with a “clean-coal” coal gasifi-cation plant proposed to gen-erate power. While it seems Franken may oppose the plant, he says he supports the techn-ology but is unsure if it’s appro-priate for that place at this time.

“The idea of coal gasification where you can sequester the CO2 is a technology that we ought to develop,” Franken said. “I’m just not sure at that plant is the best project. We want to get the most bang for the buck, and you want to make sure it’s sequestered properly.”

The technology is needed, he said, as China and India put up a coal-fired plant once a week. It does no good for the United States to seek a zero-carbon footprint when the other two nations continue unabated with carbon emissions.

“We need international agreements,” Franken said, such as a global cap-and-trade program to control carbon dioxide emissions, or the ability to sell U.S. clean-coal technology abroad.

On forestry, Franken says one of his strongest supporters is Sen. Tom Saxhaug, DFL-Grand Rapids, who specializes in forestry issues. “Tom is a big champion of sustainable forests, and I think there’s tremendous possibilities of using forest products for biomass gasification.”

If it’s any indication of his willingness to learn northern issues, Franken has been also been endorsed by Assistant House Majority Leader Frank Moe of Bemidji, Rep. Brita Sailer of Park Rapids and Sen. Rod Skoe of Clearbrook. He also recently won the endorsement of former U.S. Agriculture Secre-tary Bob Bergland of Roseau, who also served as U.S. House member from the 7th District.

Brad Swenson is the Bemidji Pioneer’s Opinion page and political editor.

BENEFITS OF COAL???

Can you describe the health benefits of coal, the economic benefits of coal?

Coal has costs, we all know that. A refresher… Remember Dr. Ed Anderson’s testimony in the Mesaba case, about the cost of pollution, health impacts of coal, and the studies we included:

Edwin Anderson, M.D. Rebuttal Testimony

Ex. 2 – Price of Pollution

Ex. 3 – Environmental Costs of Diseases and Disabilities

Ex. 4 – Environmental Pollutants and Disease in American Children

Well, there’s been this recurrent theme of the “benefits” of coal, sort of like when the Mayor of Hoyt Lakes, regarding all the mercury testimony, said, I SWEAR TO DOG, that “We’re used to mercury here!” Anyway, Ed Anderson, M.D., had submitted the above in the Excelsior Energy PPA docket, and “the benefits of coal” came up at the Mesaba hearing two weeks ago when Alan Muller was questioning Excelsior’s witness Skurla, from the Uof M Duluth Labovitz Center:

Q. Table at 3.4-2 identifies, by my arithmetic, a total of something over 15 million pounds per year of regulated air pollutants. And without getting into detail, let me just suggest, if I may, for purposes of this question, suppose that 15 million pounds a year of regulated air pollutants would constitute a negative impact. If those 15 million pounds a year air pollutants were to cause asthma, bronchitis, cancer of the lungs and so on and so forth, in a certain number of people, those people would need — might very well, probably would seek medical care for those problems,and they would buy inhalers, they would go to the emergency room, they would experience surgicalprocedures at the local health care facilities and so on. In your model would that be a component of economic stimulus?

MR. STARNS: Object to the form of the question.

JUDGE MIHALCHICK: Can you answer that?

A. Not really. I don’t — I mean, he’s asking a hypothetical question I don’t quite understand. I mean, he’s trying to lead me to say that it’s going to cause economic damage, and I’m not in a position to — I’m not an environmental person, so I’m not going to say that that’s necessarily going to happen. There’s other witnesses that maybe could answer that question.

Q. I appreciate that, and I’m trying to focus my question to you on the specific issue of whether —

JUDGE MIHALCHICK: Is the question whether his model included such a cost?

Q. Yes, whether increased use of health care facilities, funeral homes and so on and so forth would constitute a form of economic stimulus that would be acknowledged as such in your model?

A. I mean, if you want to look at it in a bizzare way, yeah.

Q. How is that bizzare?

A. Well, funeral homes are businesses. Hospitals are businesses. They need sick people, I mean, if you want to look at it. We’re not taking that into account, taking that pollution into account here, and you need to ask other witnesses about, you know, the environmental impacts or the effects of those.

MR. MULLER: I don’t have anything more. Thank you.

The theme… continues in the Grand Forks Herald, in an opinion piece, where the writer, a STATE SENATOR for Dog’s sake, says:

Externalities are artificial values that are intended to offset hidden impacts to society and the environment. However, Minnesota was only looking at what would be considered as negative externalities. There also are positive aspects of coal-based electricity that weren’t considered. For example, there have been peer-reviewed studies that show how low-cost, reliable coal-fired electricity contributes to the health and wealth of Americans, because those Americans then have more money available for health care, fresher foods and refrigeration to preserve foods longer.

Really, coal is good “because those Americans then have more money available for health care…” Here’s the link:

Coal’s hidden benefits offset its hidden costs

Yup, ain’t it a good thing that we’ve got that money for health care? I’m sure that will make Dr. Anderson feel a lot better about coal… Eh, Ed? We’ll all feel better…