PGE to stop burning coal at Oregon power plant in 2020

Mon Nov 22, 2010 3:12pm EST

 NEW YORK, Nov 22 (Reuters) - Portland General Electric Co
(PGE) (POR.N) planned to stop burning coal at the Boardman
power plant in Oregon, the state's only coal-fired plant, by
the end of 2020 to meet pollution rules.
 PGE however has not decided whether it will shut the
585-megawatt plant or convert it to another fuel, most likely
biomass, Steve Corson, a spokesman for PGE told Reuters
 On Friday, the Oregon Public Utility Commission approved
PGE's plan to meet customers' electricity needs over the next
20 years, including the Boardman proposal.
 "This plan responsibly addresses the future energy needs of
our customers and strikes a sensible balance between customer
costs and risks and environmental impacts and sustainability,"
Jim Piro, PGE president and CEO, said in a release on Friday.
 "It also provides a reasonable transition time for moving
away from coal to other sources of energy supply," Piro said.
 PGE's 20-year plan also proposed the construction of more
natural gas-fired and renewable generation, power transmission
lines and expansion of energy efficiency and demand side
resources programs, among other things, the spokesman said.
 PGE said it will stop burning coal at Boardman, which
provides about 15 percent of PGE's power, to comply with
federal and state sulfur, nitrogen and mercury rules.
 The spokesman said PGE determined it could cost about $500
million to upgrade the plant's emission controls to allow it to
continue operating through 2040 and beyond.
 But that is too high a price to pay in part due to the
uncertainty over what federal and state governments will do to
reduce carbon emissions to combat global warming, the spokesman
 Instead, the spokesman said PGE will spend about $75
million to upgrade the plant and keep it running until 2020.
 The Boardman proposal is contingent on approval by the
state's environmental regulators.
 Cheap hydroelectric power dominates the electricity market
in Washington, Oregon and Idaho, keeping local power prices
well below the national average.
 Hydropower provides about two-thirds of the generation in
Oregon, three-fourths in Washington and four-fifths in Idaho.
 Power costs residential customers about 9.1 cents per
kilowatt hour in Oregon, 8.3 cents in Washington and 8.5 cents
in Idaho versus the 2010 U.S. average of about 12 cents.
 Like Oregon, Washington has only one large coal-fired power
plant, the 1,376-MW Centralia station.
 In the spring, TransAlta Corp (TA.TO), which owns
Centralia, agreed to work with Washington to significantly
reduce the plant's greenhouse gas emissions and provide
replacement capacity by 2025.
 Idaho, meanwhile, in 2006 established a two-year moratorium
on processing proposals for new coal plants, and has continued
to reject all coal plant proposals since then. Idaho has no
coal-fired plants over 10 MW.
 Oregon and Washington, which are both rich in hydro, wind
and geothermal potential, also have renewable portfolio
standards that require utilities to meet more of electric load
with renewable energy sources.
 Oregon requires the largest utilities to meet 25 percent of
electric load with new renewable energy sources by 2025.
 Washington requires all utilities serving at least 25,000
people to produce 15 percent of the energy from renewable
sources by 2020.
STATE:      Oregon
COUNTY:     Morrow
TOWN:       Boardman about 160 miles east of Portland, the    
    biggest city in Oregon
UNIT(S):    One steam turbine
FUEL:       Sub-bituminous coal
DISPATCH:   Baseload
1980 -      Plant enters service
2020 -      PGE could retire plant due emissions rules
 (Reporting by Scott DiSavino; Editing by Marguerita Choy)