Turning On The Juices

Rush to build power plants must balance
demand with environmental, community concerns

Carolyn Said / SF Chronicle 30jan01

As California's energy situation continues to disintegrate, building power plants faster has become the new mantra. Everyone with an interest in the state's energy crisis is repeating it, from President Bush, who says we should do it by relaxing environmental constraints, to Gov. Gray Davis, who says his still-unnamed energy czar will cut through red tape to fast-track approvals.

Home-grown energy is more reliable than imports from other states, which now account for a quarter of California's power. New plants not only add capacity, they generate power more cheaply and cleanly than the aging plants that dot California's back roads.

But building new plants is a complex juggling act between the urgent need for more juice and the downsides of huge industrial sites: air and water pollution, visual blight, and health and safety issues.

After years when uncertainty over deregulation stalled development of power plants while the population zoomed and the economy boomed, now there is feverish activity under way to construct new electron factories.

Nine major new California plants have been approved since April 1999 and should be online in 2 1/2 years. Collectively they will pump out 6,278 megawatts, enough for more than 6 million households.

Power companies have proposed another 15 plants, representing an additional 6,734 megawatts, which are now under review by regulators.

In Pittsburg, about 500 builders, electricians, welders and pipe fitters are working until midnight every day on the first major power plant to be built in the Bay Area since 1972.

After two years of construction, Calpine's Los Medanos Energy Center is scheduled to go live on July 7, generating 500 megawatts -- enough to illuminate half a million homes. It will be the first major new plant in the state in a decade.

WORKING THROUGH THE NIGHT

 

Clad in yellow slickers and hard hats, the night crew of construction workers slogs through the mud around the sprawling site. Welders huddle in small sheds, their tools glowing behind the tarps that shield them from the steady drizzle. Several workers scurry by with a pump to fix a flooded area.

The sheer scale of the 12-acre power plant is hard to grasp. A single blade of one of the giant cooling-tower fans is the size of a small airplane's wing. The electrical switchyard is as large as a PG&E substation. Even the 150-foot- tall exhaust stacks are dwarfed by the rest of the plant, which spreads around them like a huge Tinker toy.

Besides Los Medanos, new plants in Sutter and Kern counties will go online this summer. Along with several smaller, temporary plants, this summer's crop of new electron farms will produce about 1,720 extra megawatts. But that's not even 10 percent of the 20,000 megawatts guzzled by air conditioners during the hot months.

It will take until the summer of 2003 before all the construction pays off with enough wattage to guarantee the lights will stay on.

And that prediction assumes that all of the state's elderly power plants stay up and running.

In the through-the-looking-glass world of California's energy market, where nothing is as it seems, even more power plants wouldn't have necessarily fixed the problems this month. That's because the almost-constant Stage 3 alerts and intermittent rolling blackouts were not actually caused by having too few power plants, many experts said.

GENERATING PLANTS IDLE

 

Instead, the alerts were triggered by having an unusually large number of plants go offline -- reportedly for maintenance, though many cynics think the power generators were gaming the market to drive up prices, or selling their natural gas supplies on the spot market at a nice profit.

One statistic is quoted so often that it has come to symbolize everything wrong with California's approach to energy: It takes seven years to build a new power plant in the Golden State, compared with just two years in Texas.

"That's patently false," said Michael Shames, executive director of the Utility Consumer Action Network, a nonprofit consumer group in San Diego. "The proponents of this myth -- the power generators -- think if they say it enough,

it will become true. They want to use it to weaken air pollution restrictions to grease the skids so they can build power plants at less cost and with less work."

State power regulators also bristle at the seven-years figure.

"That's urban folklore," said Claudia Chandler, assistant executive director of the California Energy Commission, which oversees permitting of all plants over 50 megawatts. "I read in Time magazine this week that we have 44 projects in the licensing process and haven't licensed one. That's not true."

In fact, the commission approved five major plants last year -- three of them in December -- and gave permits to four plants in 1999.

But prior to that, the last new plant approved was in 1996 -- and the power company behind it withdrew the project. Throughout the 1990s, California built eight small plants that collectively generated only 1,075 megawatts of new power.

Demand was allowed to outgrow supply as power companies waited to see how deregulation would be structured and whether building here would be profitable.

4-YEAR TURNAROUND

 

Rather than seven years, constructing a new plant in California takes four years: two years to prepare an application and get through the permitting process and two to build, according to several power company executives. The actual permitting process is limited by law to one year, although state regulators can stop the clock if they need additional data.

Much of the application time is spent studying and mitigating the ways a power plant will affect its surroundings: air and water quality, species habitats, soil and agriculture, noise, waste management and resources such as Indian mounds and paleontological sites.

"It's much quicker in other states, no question about it," said Mark Harrer,

a project director with power company Mirant Corp. "But I find (the process in California) fair."

Harrer is shepherding the permit process for two proposed Bay Area plants, the 530-megawatt Contra Costa Power Plant in Antioch, and the 540-megawatt Potrero Power Plant Project in San Francisco.

Although the Potrero facility would be next door to an existing plant, Potrero Hill has changed dramatically from an industrial area to a residential neighborhood in the four decades since the older plant was built. Potrero residents question why they should have a plant in their midst.

Their reluctance to live next door to a power plant has gotten Californians a reputation for hollering "Not in My Backyard."

But some say the NIMBY label is misplaced.

"People are confusing NIMBYism with the community's desire to know about and be involved in something going on in their neighborhood," said Shames, the San Diego consumer activist. "Are residents involved in proceedings? Absolutely. Do they ask a lot of questions? Of course? Is that NIMBYism? No."

Mirant's Harrer said he realizes there is a range of feelings among community residents. "No one's going to stand up and cheer and say, 'Hey, great, Mirant, we love you.' I'm not that stupid. But most responsible citizens recognize the need (for a power plant). What most of them want is to make sure the things they're concerned about aren't left out in the process."

That desire translates into hours and hours of community meetings to hash out everything from how wind patterns will affect exhaust stack emissions to whether hot water discharged from the cooling system into San Francisco Bay will hurt fish larvae.

CORPORATE BACKYARD

 

Giant networking firm Cisco has gotten tagged with the NIMBY label.

It is building a megacampus for up to 20,000 employees in Coyote Valley, south of San Jose, but steadfastly opposes Calpine's proposal to construct a power plant half a mile away. The San Jose City Council also rejected the 600- megawatt Metcalf Energy Center. Meanwhile, the plant has support from the Sierra Club, the American Lung Association, the NAACP and the San Jose Silicon Valley Chamber of Commerce.

"Why should someone else take plants in their backyard to provide electricity to San Jose?" said Shmuel Oren, a professor of industrial engineering at the University of California at Berkeley and the site director for the Power Systems Engineering Research Center.

"Everyone must carry his own weight in this regard. If the people of San Jose were faced with getting a disproportionate amount of rolling blackouts because they're not allowing plants to be built, maybe that would get some response."

Just how to amp up the power plant building process is still uncertain.

'PEAKER' PLANTS

 

Gov. Davis signed legislation in September designed to streamline approvals.

It allows plants that generate less than 100 megawatts to cut the certification process in half, to six months. It also expedites approvals for "peakers" -- temporary plants that operate from June to October for up to three years and are allowed to produce more pollution than permanent plants.

But so far the new law has attracted just two applicants, the 99-megawatt Hanford Energy Park proposed for Kings County, which qualifies for the six- month process, and a peaker called United Golden Gate Power Project, proposed for a site at SFO. Several smaller peakers are on the drawing boards for this year but aren't part of the new fast-track process.

Speeding up approvals for elements of infrastructure that power plants must connect to, such as gas supplies and transmission lines, is a priority for the energy commission.

Some observers have suggested that existing plants be allowed to exceed their emission requirements so they can run full tilt more often. The obvious drawback would be increased pollution.

Another proposal would stop the current practice of automatically halting construction of a plant when it is challenged on environmental grounds; instead, a stay would be granted based on the merits of the particular challenge, as is done in other court cases.

Harrer of Mirant suggested that regulators could take a cookie-cutter approach to the aspects of plants that are the same. Virtually all the large plants are powered by natural gas and use very similar technology for cooling water, gas supply and air emissions.

ENVIRONMENTAL CONCERNS

 

But environmentalists and community activists fear that the current crisis could lead to ramrodding through too many new plants, without concern for their impact.

"Given the present climate of hysteria, can any community refuse a power plant?" said Paulette Lagana, president of CAP-IT (Community Abatement of Pollution-Industrial Toxins), an eastern Contra Costa County environmental education group.

Pittsburg, already home to six power plants, now has two under construction.

Neighboring Bay Point and Antioch have three existing plants and one in the permitting process. All told, eastern Contra Costa could host a dozen power plants within a couple of years.

"Unfair burden is the phrase that comes to mind," Lagana said. "This is an environmental justice issue."

At the California Energy Commission, despite getting pressure from all sides, regulators don't want to let the system run amok.

"We don't want any more Love Canals," said Chandler. "We want to a walk a fine line between streamlining the bureaucratic stuff and making sure that these plants operate in a way that is environmentally responsible. I don't think anybody in this state wants to get the skies as smoggy as those in Houston."


E-mail Carolyn Said at csaid@sfchronicle.com

CHART (1):
Power plants in the pipline
The California Energy Commission has approved construction of these power 
plants, all
fueled by natural gas, which collectively would produce 6,278 megawatts -- 
enough to 
power 6.3 million homes -- by the summer of 2003. The first six plants on the 
list are 
under construction now; the other three will break ground this spring.

Project         Proponent      Size      Cost          Location             
Date
                        (megawatts)                                      
operational   
1 Los Medanos   Calpine         500  $300 million  Pittsburg	          July 
2001	
  Energy Center
2 Sutter Power  Calpine         500  $300 million  Yuba City,             July 
2001
  Project                                          Sutter County
	
3 Sunrise Power Texaco          320  $180 million  Derby Acres,           
August 2001
  Project(x)    Global                             Kern County	
                Gas & Power                                              
4 La Paloma     PG&E           1048  $730 million  McKittrick,            
November 2001	
                National                           Kern County
                Energy Group   
5 Moss Landing  Duke Energy    1060  $500 million  Moss Landing,          June 
2002
  Power Plant                                      Monterey County       
  Project                                                                
6 Delta Energy  Calpine and     880  $450 million  Pittsburg	          July 
2002
  Center        Bechtel         	
  
7 High Desert   Inland Group /  720  $350 million  Victorville,           
January 2003
                Constellation                      San Bernardino County  
                Energy		
8 Elk Hills     Sempra/OXY      500  $300 million  Bakersfield,           
March 2003   
  Power Project                                    Kern County
9 Pastoria      Enron           750  $350 -        Tejon Ranch,           June 
2003	
  Energy Facility                    $450 million  Kern County

(x)Temporary "peaker" plant, licensed to operate until Dec. 31, 2002.
.
CHART(2)
Power plants on the drawing board
These power plants have been proposed and are under review by the California 
Energy Commission. They would generate 6,734 megawatts. All use natural gas.

Project	              Proponent	    Size   Cost	         Location
		             (megawatts)
1 Blythe Energy       Wisvest	     520   $300 million	 Blythe,
  Power Plant                                            Riverside County
2 Contra Costa 	      Mirant(z)	     530   $300 million	 Antioch  
  Power Plant	      Mirant(z)	     530   $300 million	 Antioch  
3 El Segundo Power    NRG and 	     630   $350-         El Segundo, 
  Redevelopment       Dynegy               $400 million	 Los Angeles County
  Project
4 Hanford Energy      GWF Power      99	   $70 million	 Hanford, 
  Park Project(y)     Systems Co	                 Kings County
5 Huntington Beach    AES     	     450   $130 million	 Huntington Beach,
  Power Station                                          Orange County
6 Metcalf Energy      Calpine	     600   $300 million	 San Jose 
  Center
7 Morro Bay Power     Duke Energy    198   $650 million  Morro Bay,            
      
  Plant Project                                          San Luis Obispo   
County
8 Mountainview Power  Thermo Ecotek  1,056 $550 million	 unincorporated 
section of 
  Plant Project                                          San Bernardino County
9 Nueva Azalea Power  Sunlaw Cogen   550   $450 million  South Gate,
  Plant Project       Partn.                             Los Angeles County
10 Otay Mesa 	      PG&E 	     510   $300 million	 western San Diego County, 
   Power Project                                         1.5 mi.north of Mexico
11 Potrero Power      Mirant(z)	     540   $260-	 San Francisco
   Plant Project                           $350 million
12 Three Mountain     Ogden Pacific  500   $300 million  Redding, 
   Power Project      Power                              Shasta County
13 United Golden Gate El Paso 	     51	         n/a     SFO, San Mateo County
   Power Project(y)   Merchant 
                      Energy
14 Western Midway-    ARCO Western   500   $300 million	 40 miles west of 
Bakersfield,       Sunset Power                                          Kern 
County
   Project Energy 

(x)Temporary "peaker" plant, would be licensed to operate 12 hours a day, five 
days a week, from June 1 
   to Oct. 31 until 2003; expedited licensing process.
(y)Qualifies for expedited licensing process of 6 months, because under 100 
megawatts.
(y)Formerly Southern Co.

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