Power hungry

MEA wants coal-fueled facility

February 4, 2007

By Russell Stigall/Frontiersman

MAT-SU - Where in the Valley would be a good spot for a 100 megawatt coal-powered generator?

Matanuska Electric Association is asking its members where they think the cooperative should build two new generators - one a gas-powered turbine and one spun by burning coal.

In a situation reminiscent of the recent controversy over the location of a medium-security prison in the Valley Garvan Bucaria of Wasilla gave a familiar response.

&#8220Not in my back yard,” he said.

MEA officials said they are looking to the future in proposing to build their own electrical generation. MEA's board wants to have the project up and running by the time the association's current contract with Chugach Electric Association runs out Dec. 31, 2014.

At a meeting on Friday, MEA gave as the main reason for its new generators the anticipated price increases in the electricity the association buys in bulk from Chugach Electric. The increases are tied to the dwindling supplies of gas at Chugach's Beluga field. MEA would like to find less expensive alternatives to Chugach power.

At a Southcentral energy forum in September, researchers gave a bleak outlook on the future of gas-powered electricity.

Industrial and household users have depleted 80 percent of known reserves of gas in Cook Inlet. Of the 20 percent remaining, more than 50 percent will be liquefied and shipped out of Alaska or converted to fertilizer for export.

The forum's report predicted the end of inexpensive gas. Residential gas prices have doubled since 1996 and are expected jump another 30 percent this year. The end of cheap gas heralds the end of cheap gas-turbine produced electricity.

MEA estimates gas prices in 2015 to be between $6.25 and $10 per million BTUs, while coal will cost a paltry $2 to $2.50 by comparison. This is why the association chose coal as its main source of baseline power generation.

Also on the horizon, Chugach plans to make upgrades to the intertie powerline that runs from the Kenai Peninsula to Fairbanks. This will make MEA infrastructure obsolete and cost the co-op tens of millions to catch up, according to MEA.

Another reason for the generators is for power of the negotiation type.

MEA needs to be on par with larger utilities in Alaska by producing its own power, MEA spokesman Tuckerman Babcock said.

At the association's meeting Friday, Babcock was asked why MEA did not work with Chugach and develop a larger power plant to share. Babcock said that from an 18-year history of rate cases, the coop has come to find it is better to deal with Anchorage in a position of power. And that four years of trying to get Chugach to sit down and develop a shared generation plan has failed.

Chugach does not want to cooperate with anyone else, MEA General Manager Wayne Carmony said.

Referring to Chugach's takeover attempt of MEA, Carmony said, &#8220Their idea to work with us to solve some of the problems was to acquire us.”

The large Chugach Electric has shown little interest in the past to the needs of Mat-Su power uses, Carmony said.

&#8220We are first off and last on in the event of an outage,” Carmony said.

The new power project will be financed through MEA Finance Corporation, MEA spokesman Tuckerman Babcock said. The association will contract an independent contractor to build and run the plant.

&#8220We can do it more efficient and less expensively with an [Independent Power Producer],” Babcock said. To prevent similar problems MEA encounters with Chugach Electric Association the coop would require it be the IPP's only customer. MEA would eventually take over plant, Babcock said.

The area MEA designated as suitable for a possible generation site forms a triangle drawn from Houston to Sutton to Eklutna. The site will have to be at least 160 acres. It will be most economical to stay near highways, rail and existing gas lines, Babcock said.

Only a small section of this triangle lies near a railroad. The main transportation option for coal delivery.

&#8220We are not trucking coal,” Babcock said.

Hollywood Road and near Sutton's coal mines were recommended during the meeting.

The association invited Dr. Robert Pearson to explain the reasoning behind the recommendations of his firm CH2M HILL, an international engineering, construction and operations corporation.

For the Mat-Su Chugiak-Eagle River area base load demands CH2M HILL recommended a 100 megawatt circulating fluidized bed coal generator.

Coal's low price and reliable source at Healy make the generator best for base loads, Pearson said.

The generator produces fewer emissions than conventional pulverized coal plants.

Another advantage to a fluidized bed generator is it can burn biomass. Wood chip or railroad ties or old tires. MEA's plan calls to produce as much as 10 percent of the generator's power with biomass.

The second generator in MEA's plan is a General Electric simple cycle gas turbine. The turbine is based on GE jet engine technology. It can be run on multiple fuels, including natural gas and naphtha. GE's turbines come in 5 to 500 megawatt sizes and are tried and true technology, Pearson said.

&#8220You can buy these and have them up and running in months,” Pearson said.

The gas turbines will only be a source of peak power.

They work well in that role because gas turbines can come online fast.

&#8220You can push the button and have it up and running in two minutes and at full power in five,” Pearson said.

MEA's full plan for future power requires 300 megawatts of total capacity. The initial 200 megawatts of coal and gas power will be supplemented by either a 50 megawatt gas turbine or renewable source in 2026, and another 50 megawatt turbine or renewable source in 2043.