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Kentucky Approves LG&E Proposal for Gas Plant at Cane Run

Louisville Gas and Electric has secured state approval to build natural gas turbines at its Cane Run Power Station. The Kentucky Public Service Commission issued its ruling today.

The ruling will allow LG&E to build a 640 megawatt natural gas power plant at the current site of the coal-fired Cane Run Power Station, which is set to be retired by 2016. The company will also buy existing gas generation in Oldham County, if it gets approval for the project from the Federal Energy Regulatory Commission.

Environmental groups intervened in the case, arguing that LG&E should examine sources other than gas to meet the area’s energy demand—like renewable sources and efficiency measures. In the order, the commissioners disagreed, but did require the company to commission a study to determine what energy savings can be achieved through efficiency programs.

Earthjustice attorney Shannon Fisk was co-counsel for the environmental interveners. He says even though the application was granted, the efficiency study “is real progress that will hopefully save customers money and also be beneficial to the environment,” he said.

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PSC Approves LG&E Proposal for Gas Plant at Cane Run

The PSC has approved Louisville Gas and Electric’s application to construct a 640 megawatt natural gas power plant at the current site of the gas-fired Cane Run Power Station. The company will also buy existing gas generation in Oldham County.

The company already had approval to retire Cane Run, as well as two other coal-fired power plants. The PSC heard the case to add the gas turbines in March. The proposal was opposed by environmental groups, which argued the generation capacity could be replaced with renewable sources and energy efficiency measures.

LG&E estimates the nearly $700 million project won’t raise LG&E customers’ rates. Because they’re estimated to use a large share of the power, the project will raise rates about 4 percent for Kentucky Utilities customers. But previously-approved environmental upgrades to two of LG&E’s coal-fired plants–Mill Creek and Trimble County–are expected to raise LG&E rates 18 percent by 2016.

Will be updated.

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Environment Local News

New EPA Rules Will Limit Carbon Pollution for All Future Power Plants

The federal government has unveiled air quality standards that will affect new coal-fired power plants. The new EPA rules mark the first time carbon dioxide emissions from all new power plants will be limited.

This doesn’t mean there won’t be any new coal-fired power plants built in the U.S., but it does mean that any company that wants to build one will have to install advanced carbon control technologies, like carbon capture and sequestration. Plants will have a limit of 1,000 pounds of carbon pollution per megawatt hour.

EPA Administrator Lisa Jackson hailed the rule as a step forward to address climate change.

“This standard isn’t the once and for all solution to our environmental challenges,” she said. “But it is an important, common sense step to tackling the ongoing and very real threat of climate change and protecting the future for generations to come.”

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PSC Hears Testimony in LG&E Natural Gas Case

Kentucky’s Public Service Commissioners are considering a proposal by Louisville Gas and Electric to convert some of the company’s coal-fired facilities into natural gas plants. The PSC held a formal hearing on the issue today.

LG&E already has permission to retire three of its coal-fired power plants, including the Cane Run plant in southwest Louisville. Now, the PSC is considering the plan to build natural gas turbines at Cane Run and purchase existing turbines in Oldham County.

The majority of the questions during the hearing came from an unlikely source: environmental groups. The groups—including the Sierra Club and Earthjustice—have aggressively targeted coal-fired power plants across the country. In this case, they’ve applauded the shut down of the coal units but are arguing that a better replacement would be renewable sources and energy efficiency.

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PSC Will Hold Formal Hearing Tuesday on LG&E Gas Conversion Plan

The Public Service Commission will hear testimony for and against a proposed project at Louisville Gas and Electric’s Cane Run power plant tomorrow.

The utility company is asking for permission to retire several coal-fired power plants, including the Cane Run Power Station in southwest Louisville. It plans to replace the generation capacity with both new turbines—at Cane Run—and existing natural gas generation in Oldham County. The project is expected to cost about $700 million.

LG&E’s application argues this is the most cost-effective approach, because upcoming pollution regulations would require new environmental controls to keep burning coal.

At a public hearing earlier this month, there was no public outcry over the project. Many living near the plant have complained about pollution from the company’s coal ash landfills in the past, and they want the company to stop burning coal as soon as possible.

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PSC Holds Public Meeting on LG&E Cane Run Proposal Tomorrow

The Kentucky Public Service Commission will hold a meeting tomorrow to allow the public to weigh in on a proposal by Louisville Gas and Electric. The utility is asking the commission to approve a plan to convert the coal-fired Cane Run Power Station to natural gas.

LG&E wants to reconfigure the Cane Run power plant to use natural gas because of the increased cost to comply with upcoming federal air pollution regulations. A potential end to coal-burning is welcome news for many living near the plant, who cite pollution from the coal ash landfills on the property. But PSC spokesman Andrew Melnykovych says with decisions like this, the commission doesn’t take environmental issues into account.

“The only aspect of the environmental compliance that the PSC considers is the cost and how that is to be passed on to the ratepayers,” he said. “But in terms of issues such as the future of the ash landfills at that facility, that is not something that the PSC has any jurisdiction over.”

By law, the Public Service Commission is required to make sure utilities are providing the most reliable electricity at the lowest cost to consumers.

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PSC Sets Date for Public to Comment on LG&E Coal to Gas Proposal

The Kentucky Public Service Commission has set a public meeting for Louisville residents to weigh in on a proposed switch from coal to natural gas at the Cane Run Power Station.

In September, Louisville Gas and Electric announced that it was planning to retire its coal-fired Cane Run Power Plant and replace it with a natural gas generating facility. Two other plants—in Muhlenberg and Woodford counties—will also be retired. LG&E is proposing the change be made by 2016, in response to new federal air pollution regulations.

But the company’s proposal still has to be approved by the Public Service Commission, and they’re seeking public input. LG&E wants to construct a 640 megawatt gas plant on the Cane Run site, as well as buy a smaller gas power plant in Oldham County. The smaller plant will run only when there’s peak demand.

The company estimates the project will cost nearly $700 million, which includes the new plant, purchasing the plant in LaGrange and running a natural gas pipeline to Cane Run.

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Indiana Coal Gasification Plant Wins Regulatory Approval

From the Associated Press

Indiana regulators have approved plans for a $2.65 billion coal gasification plant at the Ohio River city of Rockport and a state agency’s 30-year contract to buy its synthetic natural gas.

The Indiana Utility Regulatory Commission endorsed the plan that Gov. Mitch Daniels has promoted as locking in low rates for the state’s natural gas users and increasing the use of Indiana coal.

Under the deal, the Finance Authority will spend an estimated $6.9 billion over three decades to buy gas from Indiana Gasification LLC, a subsidiary of a New York-based investment firm.

The agency will sell the gas on the open market, with its sale at a loss potentially leading to higher bills for Indiana consumers.

Consumer advocates have called the deal “socialism for corporations.”

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Environment Local News Politics

Paul Meets With NTSB to Discuss Pipeline Hold

Kentucky Senator Rand Paul is continuing his block on a bill that would update safety regulations on natural gas pipelines. Paul met with members of the National Transportation Safety Board about the matter today.

The legislation was introduced in response to an explosion at a gas pipeline in San Bruno, California last year that killed eight people. The measure has bipartisan support and passed through committee unanimously, but Paul has placed a procedural hold on the bill, which means it can’t be fast-tracked and needs 60 votes to overcome the hurdle.

California’s two senators have called on Paul to lift his hold, stressing the importance of the legislation to prevent other communities from suffering pipeline explosions.

In a statement, Paul stressed the need for sufficient debate on the bill. He said that the legislation was written before the board issued recommendations to prevent another disaster similar to San Bruno. Specifically, he wants a clause removed from the bill that exempts older pipelines from the regulation.

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Study Indicates Switch to Natural Gas May Not Slow Climate Change

As federal policies make burning coal more expensive, many utilities—including Louisville Gas and Electric and Kentucky Utilities—are transitioning their older coal plants to natural gas. But a new study cautions that natural gas may not be a panacea to stop the effects of climate change.

Natural gas is cleaner than coal. When you burn it, it releases fewer pollutants into the environment. But a new study by National Center for Atmospheric Research climate scientist Tom Wigley says switching from coal to natural gas won’t halt climate change, at least in the short-term. He calls the transition a “double-edged sword.”

“On one hand, it would make the world a little warmer but on the other hand, it would reduce the effects of pollution,” Wigley said.

Phasing out coal would reduce the amount of carbon dioxide released into the atmosphere, but natural gas drilling and transporting results in a small amount of leaked methane.

“The leakage rate now might only be 2-5 percent,” Wigley said. “But that’s still significant because methane is such a powerful greenhouse gas.”

Also, sulfate aerosols released by coal burning reflect solar radiation back into space and actually have a slightly cooling effect on the atmosphere.

Wigley says his findings don’t mean that coal is better than gas, just that there are many factors other than carbon dioxide that should be considered when deciding climate policy.

Wigley’s paper is scheduled to be published in the peer-reviewed journal Climatic Change Letters next month.