Business

Local utilities weigh in on EPA rule

Kentucky Utilities' Green River plant will be closed because of the new EPA rules. KU wants to spend as much as $800 million to build natural gas-fired power generators to replace coal-fired units.
Kentucky Utilities' Green River plant will be closed because of the new EPA rules. KU wants to spend as much as $800 million to build natural gas-fired power generators to replace coal-fired units. Photo courtesy Kentucky Utilities

Kentucky electric companies have been studying the new EPA rules announced Wednesday through the various draft stages released in the past.

"It is good to have the final standards, so that we have a clearer picture of the requirements and can solidify our compliance plans," said Kentucky Utilities spokeswoman Chris Whelan. "While the mercury limits did not significantly change in the final standards, there are other components in the 1,100-page rule that were modified."

Kentucky Utilities has already received approval from the state Public Service Commission to proceed with improvements at its Ghent and E.W. Brown plants based on the new rules. The utility's monthly environmental surcharge will increase 0.89 percent starting in 2012, and it will be 9.65 percent higher by 2016, according to KU. For a residential customer using 1,000 kilowatt hours a month, the monthly increase will be 69 cents in 2012, rising to $7.47 by 2016.

The utility also is seeking the commission's approval for a new power generation portfolio as it expects to close its older Tyrone and Green River plants because of the new EPA rules. KU is asking for permission to spend as much as $800 million to build natural gas-fired power generators to replace older coal-fired units. KU expects to eventually ask for a 4 percent increase in rates to pay for the units.

Whelan said the utility will continue to study the regulations to review potential impact to its plans, "but as we told the Kentucky Public Service Commission, in order to meet the aggressive compliance time line, we have already begun the process needed to be compliant by 2016."

East Kentucky Power Cooperative, which supplies electricity to 16 member co-ops, has hired a consultant "to take a close look at all of these rules ... and determine what the potential impact will be, what the compliance options would be and what the costs of those are," said spokesman Nick Comer.

"It's going to take a while for us to get a close look at that and determine what the impact is going to be," he added.

Related stories from Lexington Herald Leader

  Comments