Legal & Regulatory

A Novel Managerial Challenge: Decommissioning Coal

With low-cost natural gas and the high cost of new environmental regulations shutting down coal-fired power plants all across the country, a new task for power industry managers is emerging: decommissioning old coal plants. As in the case of dismantling and disposing of old nuclear plants, decommissioning coal plants can be a difficult and expensive venture.

While there is no radiation to deal with in interring old coal plants, there can be lots of surprises that typically don’t show up in nuclear decommissioning projects, such as missing or sketchy engineering drawings. No quality control and quality assurance documents. Engineers often have to rely on the misty memories of former plant workers for guidance.

Rick Scadden, principal engineer for INTERA, an environmental consulting firm in Austin, Texas, says decommissioning coal plants “is really interesting.” They are also challenging project, he adds.

In an interview with MANAGING POWER, Scadden laid out some of the challenges in managing a coal plant takedown. One problem is determining the types of environmental contaminants likely to be found once walls start coming down, equipment begins to move out, and workers scrub the plant down to paint or, in many cases, bare metal. “The possibilities are large,” Scadden said. “PCBs, asbestos, lead paint, mercury.”

Scadden noted that toxics show up in completely unexpected places. Over the years, as the plants were built, and renovated, and renovated again, material got used in ways that would be completely forbidden today. Asbestos was routinely used around equipment that might face fire risks, because its health threats weren’t recognized. Scadden noted that in decommissioning an elderly coal-fired plant in Austin, workers got hung up in dismantling four large steam boilers “when they found additional asbestos that was completely unexpected.”

There can be lots of surprises when taking an old plant apart, said Scadden. “You find strange things,” he said. “Old transformer oil, loaded with PCBs, was used to lubricate moving equipment such as rotating screens. So you get PCBs in places you would never think of. Sometimes, PCBs were used in paint to extend the paint. So you get paint that has got to be remediated on the walls of the turbine room 40 feet off the ground.”

Often there are the information gaps, which a manager of a decommissioning project would prefer to identify before breaking out the jackhammers and cutting torches. “A lot is dependent on the original design and how well the plant was maintained, and the documentation for that.” QA and QC programs were not the priority 50 or 60 or more years ago that they are today. “Some plants are in great shape, with little contamination,” says Scadden. “Others, not so. One of the things we have done is go back to former employees, get some of them in the same room together. They know a lot of stuff about those old plants, and they like talking about it.”

Big Ticket Clean-Up

Environmental issues are the big-ticket items in decommissioning an old plant, notes the engineering firm Burns & McDonnell. In a recent paper, the company says, “Asbestos abatement must occur before any demolition. Remediation also involves lead abatement and PCB and mercury contamination removal where necessary.”

The planning for a coal plant decommissioning starts with evaluating the future uses of the site. “Are you going to try to clean out the plant and leave the shell?” asks Scadden. “Or are you going to tear it down and leave a brownfield site? Or are you going to completely decommission it and use it for repowering” with a natural gas plant?

Burns & McDonnell points out, “Repowering a plant with gas-fired elements can make sense because so much critical infrastructure is already in place, including transmission lines, substations, and water.” Says Jeff Kopp, Burns & McDonnell’s manager of project development, “Can you retrofit existing equipment, either by converting the boilers to burn gas or installing a combustion turbine in combined cycle with existing steam turbine? Can you rescue the site by using all-new equipment and take advantage of existing infrastructure? Or do you abandon the site altogether and build elsewhere?”

The economic equation can be complex. Not only may the existing equipment have value in other uses, but the value of scrap metal in a plant can also be significant. Kopp says a recent study a demolition contractor did for a plant decommissioning overlooked the scrap value. “This dramatically changed the net demolition costs for that facility because we were able to uncover several million dollars in credit.”

Decommissioning an elderly fossil-fueled plant is expensive (although not nearly on the scale of a nuclear decommission project, which can run into hundreds of millions of dollars). According to INTERA’s Scadden, a recent project in Austin, merely cleaning up a city-owned power plant cost $3.5 million. That figure does not include demolition.

A New Lease on Life?

Sometimes non-economic concerns enter into the decommission process. That’s what happened with the Austin project that Scadden mentioned. The Seaholm plant, serving the municipal utility, went into service in 1950 as a coal-fired unit. It later burned fuel oil and natural gas and went into standby service in 1989. The plant effectively shut down in 1996, and the Austin utility began thinking about decommissioning it 10 years ago. But many in the community wanted to preserve the shell of the historic, art deco-style building. A grassroots movement formed to save it.

So the power plant has become the center of an urban development district on Shoal Creek before it enters the Colorado River. The former industrial area in the southwest portion of downtown will become a residential and shopping zone centered on the former power plant, which will eventually house 298 apartments, 43,000 square feet of office space, 84,000 square feet of retail space, and a 24,000 square foot event center. Next door will be a new central public library.

Austin’s power plant decommissioning story looks like a success. But every project is different, and there are plenty of question marks in any effort to remove a coal-fired plant. One area of uncertainty is the existence of a coal ash pond. This issue, says Burns & McDonnell, is “problematic because federal regulations have not been finalized.”

In that regard, decommissioning coal plants and nuclear plants share another aspect: waste management. What to do with ash ponds can hang up a coal plant decommissioning. What to do with spent fuel is a hang up with nuclear plant decommissioning. A nuclear plant can’t be fully decommissioned and turned over to a new use as long as the used fuel remains on the site.

Whether coal ash pond rules, overdue from the federal government, will also become a roadblock to decommissioning is a large open question.

As the march of gas and government regulation across the generating landscape continue to put coal plants on the shelf, decommissioning is likely to become a much bigger management issue. According to a report from The Brattle Group economic consulting firm, as of last July, 30 GW of coal plant capacity had announced plans to retire by 2016. The firm estimated that the figure will grow to 59 GW to 77 GW under current economic and regulatory trends.

—Kennedy Maize is MANAGING POWER’S executive editor

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