Why is the state’s largest electric utility, the one with the reputation for clean energy, burning coal for 20 percent of its power supply? The Sierra Club and Montana Environmental Information Center want to know. The two are suing PSE in federal court over violations of the Clean Air Act at eastern Montana's Colstrip Generating Facility, one of the biggest greenhouse gas polluters in the West.
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PSE owns 20 percent of the Colstrip Generating Station. Coltrip's other owners include Warren Buffet’s Pacific Corporation. The plaintiffs want the plant owners to install modern pollution controls for mercury, particulate matter, regional haze and coal ash. “We have been trying to work with some of the agencies to reel in the very big damages but the agencies aren't moving fast enough," says Sierra Club’s Doug Howell. "So now we have to take the action of last resort and that’s go to court.”
Puget Sound Energy has a reputation for developing clean energy. It’s the second largest generator of wind power among privately held U.S. utilities. But Colstrip, says Anne Hedges with the Montana Environmental Information Center, is the dirty little secret PSE doesn’t like to advertise. “That’s what frustrates us," says Hedges. "They seem to be able to greenwash their image. But the reality is that the man behind the curtain is filthy and he’s polluting our communities.”
Colstrip has been on the radar as one of the West’s largest greenhouse gas polluters ever since the Sierra Club and other environmental and energy activists launched the Beyond Coal campaign several years ago. With 142 coal plants slated for retirement, including those in Washington and Oregon, the campaign is working to hold big polluters accountable and push utilities to transition to clean energy. Even if Colstrip were to become environmentally compliant, major liabilities remain, including cleanup of toxic coal ash from thousands of waste ponds that are leaking into ground water. “So why would you invest hundreds of millions of dollars to beef up this plant and still have massive liabilities?" asks Sierra Club's Doug Howell. "It doesn’t make economic sense and it makes no sense for the ratepayers.”
Many utilities keep coal in the mix because it’s been cheaper to purchase compared to power from renewable sources. “The reason we are operating the Colstrip plant is because it provides our customers with very reliable and low cost power,” explains Roger Thompson, spokesperson for Puget Sound Energy. Thompson won’t comment on the lawsuit, but says the Montana coal plant is in compliance with federal and state environmental laws. “If new more rigid rules are in place then we’re going to have to make sure we follow those as well,” he adds.
Several years ago PSE’s resource allocation plan involved retiring the Colstrip plant in stages. Then in 2011, PSE put the coal plant back in its long term plans because, says Thompson, replacing Colstrip would have meant too high a cost for ratepayers.
Eric de Place, a policy analyst with the think tank Sightline, says the argument that coal is a cheap source of power doesn’t stack up. The liabilities are so severe at Colstrip that Puget Sound Energy’s Washington ratepayers are at risk for tens, if not hundreds of millions of dollars in upgrades. “PSE and the other owners have been taking a bandaid approach," says de Place. "They’re trying to cobble the plant together with duct tape and baling wire to get it to perform according to modern environmental and health standards. That doesn’t really solve the underlying problem, which is you’re still burning this extremely dirty source of fuel that is running afoul of common sense protections against haze, sulfur, mercury, coal ash and on and on and on.”
And there are other cost drivers the utility should consider, according to de Place. The cost of coal production is going up in the Powder River Basin where Colstrip mines. The easy coal has already been extracted. What remains is the deep coal, which is more difficult and expensive to remove. "The public and PSE ratepayers should have an opportunity to see a full public accounting for these costs and risks,” says de Place.
Next month Puget Sound Energy will submit a draft resource allocation plan to utility regulators. The plan will map out the types of power it plans to purchase. Regulators gave PSE a directive to examine all environmental liabilities last year after the Sierra Club intervened. Whether the state’s biggest electric utility will take account of all the costs cited in the lawsuit remains to be seen.