Cliffside Settlement Legally Binds Duke to Shutter 1,600 MW of Coal Capacity
A settlement reached between Duke Energy and conservation groups on Tuesday legally binds the North Carolina–based utility to shutter 1,667 MW of coal-fired capacity from aging plants and tighten pollution controls at the new 825-MW pulverized coal unit that is scheduled to come online this year at its Cliffside Steam Station on the Rutherford/Cleveland County line in North Carolina.
Construction of the $1.8 billion Cliffside Unit 6 is part of the company’s modernization program, which includes retiring Units 1 through 4 at the Cliffside facility, modernizing Unit 5, and retiring 1,000 MW of older, less efficient coal-fired capacity across North Carolina.
The settlement between environmental groups and Duke Energy was reached in an administrative challenge to a March 2009 final revised air permit from the North Carolina Department of Environment and Natural Resources for the plant near Shelby, N.C. Duke Energy negotiated the settlement with the Southern Environmental Law Center on behalf of the Environmental Defense Fund, National Parks Conservation Association, the Sierra Club, and Southern Alliance for Clean Energy.
According to the groups, Duke had previously included retirement of the 1,600 MW of aging coal-fired capacity in nonbinding, long-range plans submitted each year to the North Carolina State Utilities Commission. “The settlement agreement makes the planned retirements enforceable, thereby locking in reductions in air and water pollution that harms the health of children and families in the Carolinas,” the groups said in a joint statement on Tuesday.
The settlement will also force Duke to operate its new Cliffside unit with a “99.9% reduction” of acid gases—the most stringent acid gas controls in the U.S., the groups said. “The settlement also tightens a permit provision that Duke Energy must demonstrate best practices to decrease toxic air pollution emitted during malfunction, shut down and start up situations,” they said.
“We are pleased to have reached this agreement with the environmental groups regarding our Cliffside project—to make enforceable our plans before the state utility commissions to retire our older coal plants. The agreement removes the final legal issue related to the Cliffside project,” Duke spokesman Thomas Williams told POWERnews today.
Williams said Duke Energy had already committed to schedules to retire older coal-fired power plants that lack modern pollution controls as part of a Dec. 8 settlement between Duke Energy, Progress Energy, and environmental groups that were opposed to a merger between the two companies. In total, the two companies will retire 3,000 MW of coal-fired capacity under that agreement.
The Dec. 8 settlement was hailed as a victory by the Environmental Defense Fund, the Coastal Conservation League, and Southern Alliance for Clean Energy, which had intervened in a South Carolina Public Service Commission proceeding concerning the merger to advocate for inclusion of clean energy programs. It essentially made enforceable the "non-binding, long-range plans" Duke and Progress had submitted to state utility commissions.
Williams also pointed out, however, that a provision in the Dec. 8 agreement allows the companies to seek an extension if these retirements would compromise reliability in their service areas.
Duke’s settlement on Tuesday comes on the heels of one made by American Electric Power (AEP) in December. That company reached a settlement with environmental groups the Sierra Club and the National Audubon Society in an effort to resolve all environmentally based legal challenges against its 600-MW ultrasupercritical John W. Turk Jr. power plant under construction near Texarkana, Ark. Under that agreement, AEP pledged to phase out a 528-MW coal-fired unit in Texas, build 400 MW of renewable power, and limit new transmission lines in natural areas.
Sources: POWERnews, Duke Energy, Sierra Club