Oil Report

UPDATE 2-Kansas lawmakers pass bill favoring coal expansion

(Updates with coal plant official comment, Gov. Sebelius comment)

OVERLAND PARK, Kan., Feb 19 (Reuters) - Backed by powerful business interests, Kansas lawmakers on Tuesday overturned a landmark 2007 decision that rejected a coal-fired power plant expansion in the state due to global warming concerns, though the vote fell shy of a veto-proof majority.

Lawmakers in the Kansas House voted Tuesday 77-45 for a bill that would allow two coal-fired power plants in southwest Kansas. The measure strips authority from Kansas Secretary of Health and Environment Rod Bremby, who last year rejected the $3.5 billion expansion because of health risks associated with carbon dioxide emissions and global warming.

The moves in the legislature give fresh life to plans by Sunflower Electric Power Corp to add two 700-megawatt units at an existing facility in western Kansas. Business groups and a Republican-led contingent of state legislators have championed the project, saying it would create jobs, provide badly needed energy for the area and would keep electricity rates in check.

When he rejected the project, Bremby said it would be “irresponsible to ignore emerging information about the contribution of carbon dioxide and other greenhouse gases to climate change and the potential harm to our environment and health.”

The action pushed Kansas to the forefront of a national debate over the environmental effects of coal-based plants and alternative energy sources.

On Tuesday, Bremby spokesman Joe Blubaugh said the department was monitoring the situation and had no comment.

Gov. Kathleen Sebelius, a Democrat, has pledged to veto the legislation and the vote in the Kansas House fell short of the 84 votes, or two-thirds majority, needed to override a veto. An earlier Kansas Senate vote did meet that majority.

“Unfortunately, it looks like the House final version has less encouragement for either wind energy or carbon mitigation, and further restricts the ability of the Secretary of Health and Environment to protect the environment or the health of Kansans,” Sebelius said Tuesday.

The measure now heads to a conference committee where senators and House members will draft a final version for both chambers to consider in another vote. Supporters are pledging to come up with the votes needed to survive a veto.

The House measure passed Tuesday provides that the state secretary of health and environment cannot reject a permit when all requirements of the state’s existing air-quality laws have been met by a utility. Sunflower’s permit would receive approval under this provision.

The House bill also states that the secretary could not impose air-quality standards that are stricter than those in federal law without legislative approval.

Environmental protection groups, who hoped Kansas would influence more states to reject new coal-fired power plants, said Tuesday the moves by the legislature to give new life to Sunflower expansion were disappointing. But they held onto hopes for a successful veto.

They said legislators should be focused on reducing the state’s heavy reliance on coal-fired plants, which provide about 75 percent of its electricity now.

“It is very unfortunate that legislation like this was pushed through so quickly,” said Chris Cardinal, spokesman for Great Plains Alliance for Clean Energy. “We need to sit down and have a proper discussion about our energy policy in Kansas, and not be engaging in all this gamesmanship and political maneuvering.”

Sunflower spokesman Steve Miller said he was confident supporters could rally enough votes to override any veto.

“We’ve got seven more votes to come our way. I’m optimistic we can get those,” Miller said.

Sunflower represents six electric cooperatives, among 66 electric cooperatives and 10 Kansas cities that will own power produced by the coal-fired units. (Reporting by Carey Gillam; Editing by Marguerita Choy)