Georgia bill proposes moratorium on new coal plants

HOUSTON (Reuters) - Georgia legislators introduced a bill on Tuesday that, if passed, could limit utility use of certain Appalachian coal beginning in 2011 and place a moratorium on new coal-plant construction in the state.

Interest in coal-fired power plants, which produce about half the electricity consumed in the United States, surged when natural gas prices rose in 2002, but have come under attack from environmental groups.

Coal emits more carbon dioxide than any other fuel so public concern about greenhouse gas emissions and climate change has resulted in cancellations of dozens of coal plants by utilities in the past two years.

Two new coal plants are under development in Georgia and more coal plants are under construction in the U.S. than in the previous two decades.

House Bill 276 calls for utilities to eliminate the burning of Central Appalachian coal mined by “mountaintop removal” by mid-2016 and would suspend permits filed before July 2009 to build new coal-fired generation.

The bill drew a quick response from Power4Georgians, a coalition of 10 electric co-operatives that wants to build a $2 billion coal-fired plant in Washington County.

“A moratorium on new coal-fired power plants would only ensure that the cost of energy would increase substantially,” the co-op group said in a statement.

Permit applications were filed in January 2008 to develop the 850-megawatt Washington County Power Station near Sandersville, Georgia, about 60 miles southwest of Augusta.

“We simply cannot forgo development of new clean-coal projects for the next five years and expect that we will then be able to catch up,” the group said.

The Washington County station will burn a mix of pulverized low-sulfur coal from the Powder River Basin and Appalachian coal, the group said when announcing the project.

Privately held LS Power is also working to develop the 1,200-MW Longleaf coal plant in Early County, Georgia.

Currently, LS is appealing a state court’s rejection of the air permit issued by the Georgia Department of Resources last year.

Georgia is also home to 10 coal-fired generating stations owned by Southern Co’s unit Georgia Power, the state’s largest utility. Georgia Power uses coal to produce about 75 percent of power produced in the state.

Reporting by Eileen O’Grady; Editing by Christian Wiessner