Oregon Utilities Commission Takes Controversial Stance on Coal Plant

November 22, 2010

On Friday Oregon’s Public Utilities Commission drew criticism from environmentalists and renewable energy activists by deciding to approve a plan for the state’s largest utility to continue operating the Boardman Coal Plant through the end of 2020.  Portland General Electric (PGE) first proposed its “2020 plan” for the Boardman Plant early this year, when pressure from environmental groups made it clear the coal plant could not be kept open indefinitely.  The Boardman Plant is Oregon’s single largest contributor to global warming, as well as a major emitter of mercury and compounds that cause acid rain and smog pollution in nationally recognized scenic areas. 

By offering to close the coal plant in 2020, PGE hoped to deflect the criticism of the environmental community.  However groups like the Sierra Club, Greenpeace, and Physicians for Social Responsibility argue ten more years is still too long for Oregon to stay dependent on dirty coal power.  Keeping the Boardman Plant running until 2020 would make it all but impossible for Oregon to meet its goal of reducing greenhouse gas emissions 10% below 1990 levels by the year 2020.  Recently the federal Environmental Protection Agency found the Boardman Plant has been polluting out of compliance with the Clean Air Act since 1998, and issued PGE a notice of violation.

In order to move forward with its 2020 plan, PGE needs permission from the state Public Utilities Commission to invest ratepayer money in new pollution controls required to bring the Boardman Plant into compliance with clean air laws.  The PUC is a three-member panel appointed by the governor, and is charged with ensuring private utilities invest their money in a way that’s good for ratepayers. 

Yet whether keeping the Boardman Plant open for another ten years is a good investment is far from clear.  New state laws, a statewide ballot initiative, or action taken by the EPA to make the plant comply with the Clean Air Act could result in the facility closing before 2020.  Should any of these possibilities occur, ratepayer money invested in expensive pollution controls would be wasted.  Public opinion also seems to be in favor of closing the plant as soon as possible; at a Public Utilities Commission hearing in June, dozens of Oregonians testified in favor of closing the coal plant well before 2020.  Of about four hundred people who attended the hearing, an estimated three quarters came to oppose PGE’s 2020 plan.

Even so the PUC agreed unanimously on Friday to “acknowledge,” or approve PGE’s 2020 plan, which is based on the assumption that closing the coal plant before 2020 would be too risky for ratepayers.  In doing so the commission dismissed less costly early closure options, which would involve purchasing fewer pollution controls and transitioning off the coal plant sometime between 2015 and 2018.  The commission also chose to ignore objections from renewable energy activists who argue PGE has failed to adequately demonstrate closing the plan early subjects rates to more risk than burning coal until 2020.  The Oregon Sierra Clubargues PGE has failed to consider all the options for replacing the Boardman Plant with cleaner energy, and that the 2020 plan doesn’t adequately provide for the likelihood of new state or federal laws on carbon pollution

Another state agency, the Department of Environmental Quality (DEQ), will make its own decision about the Boardman Plant later this year.  The DEQ is charged with protecting Oregon’s air quality from pollution, and must decide what combination of early closure and installation of pollution controls in the meantime could bring the Boardman Plant into compliance with the law.  If the cost of operating until 2020 proves to be too much, this could still influence PGE to close coal plant earlier.  In December the DEQ will make its recommendation as to what pollution controls are necessary.

Photo credit: Nick Engelfried

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