Coal plants won’t pay, official says

The national political and economic environment for energy is changing faster than weather in the Mojave Desert, the top executive at the Sierra Club says.

Politicians from both parties are starting to embrace renewable energy and to oppose coal-fired power plants. Yet, Nevada stands out as a lonely outpost for coal-plant development in the Southwest, Sierra Club executive director Carl Pope said in an interview Wednesday.

Pope said the Silver State runs the risk of committing to costly coal-fired power plants that are burdened with expensive federal regulation and throw off massive quantities of carbon dioxide, which scientists say leads to global warming.

He pointed to plans by LS Power Group to build a 1,600-megwatt coal-fired power plant near Ely, a Sierra Pacific Resources proposal to construct a 1,500-megawatt coal plant near Ely and Sithe Global Power's plan to build a 750-megawatt plant near Mesquite.

Although advocates contend coal is a low-cost power source, Pope argues that coal power will prove more expensive than solar thermal power plants, which use the sun's heat to make electricity. The Sierra Club official pointed to estimates from Ausra, an independent solar power developer based in Palo Alto, Calif., that solar say thermal plants could generate power at 91/2 cents a kilowatt hour.

The Public Utilities Commission estimates solar thermal power costs 11 cents to 21 cents a kilowatt hour.

Sierra Pacific Resources Senior Vice President said he doesn't believe 91/2 cents is a realistic price for solar thermal power. He declined to provide a better estimate, because the company is taking bids for solar power plants and because it promised confidentiality on solar power prices from Nevada Solar One, a plant in Boulder City.

Ausra Executive Vice President John O'Donnell said the cost would be about 10 cents a kilowatt hour.

Some of the early solar thermal plants may cost 2 cents more per kilowatt hour, O'Donnell said. But he saw the price of solar thermal power dropping to nine cents from 12 cents per kilowatt hour over four years. The price projections are based on the assumption Congress extends a solar power investment tax credit by eight years. The tax credit trims 20 percent of the cost.

Sierra Pacific estimates that the coal plant will generate electricity for 6 cents to 61/2 cents a kilowatt hour.

Meanwhile, Pope expects Congress soon to enact a law that regulates carbon dioxide emissions, making coal power more expensive. Coal power plants throw off twice the carbon dioxide per unit of electricity from a gas-fired plant.

Add those carbon costs plus potential escalating costs of developing Sierra's Ely Energy Center, and Pope figures coal power would exceed the cost of solar energy.

"The big joker in the deck right now for electricity is the future cost of carbon emissions," O'Donnell said. Coal-fired plants emit twice the carbon dioxide per unit of electricity as do gas-fired plants, he said.

Nevada's neighbors -- California, Oregon, Arizona, Utah and New Mexico -- have slammed the door shut on construction of new coal plants, with the exception of areas within Indian reservations, Pope said. Coal power plants are being canceled around the country, he said.

"Once again, the country is looking to (Nevada to) take a dirty technology they don't want," Pope said, referring to the Yucca Mountain nuclear-waste-disposal project.

Denis said other states in the West already get a large portion of their power from coal-fired plants and that Nevada doesn't. He said 17 states west of the Mississippi River get half of their power from coal. Nevada gets 20 percent of its power from coal plants, relying on natural gas-fired plants for 75 percent.

Gas prices have been volatile in recent years, and Denis favors diversifying the utility company's energy mix with more coal power.

Contact reporter John G. Edwards at jedwards@reviewjournal.com or (702) 383-0420.