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Wednesday, Oct. 22, 2014

Contract amendments reflect changing EPA standards

Sunday, January 6, 2008

SIKESTON -- Amended contracts with the Sikeston Power Plant's partner cities are no big deal, according to Board of Municipal Utility officials.

"This is just standard, routine business we're required to do by the EPA," said Geoff Comer, systems analyst for the BMU.

Life-of-the-plant contracts with Columbia, Carthage and Fulton were all amended recently to account for changes in U.S. Environmental Protection Agency regulations related to noxious emissions.

"In 2009, the EPA will be issuing allowances for nox emissions for all 12 months rather than just the ozone season which is May through September," Comer explained. "The EPA just requires we have an agreement establishing what percent of the allowances that the EPA gives to the Sikeston plant goes to them. There's not any money involved."

The EPA limits the total amount of pollutants that power plants can emit. In Missouri, allowances for these emissions are distributed to utilities and power plants by the Missouri Department of Natural Resources, according to Comer. Currently, those distributions have only applied to the ozone season.

The Sikeston plant always monitors noxious emissions, according to Comer, "but because annual compliance is going to start in 2009, this was something new we had to address as far as the ownership of those allowances. They want us to have agreements in place with our contract cities."

Allowances for the Sikeston plant under rules going into effect for 2009 through 2014 are 1,556 tons of nitrogen oxides per year, only 698 tons of which can be during the ozone season, according to Michael Stansfield, operating permit unit chief for the DNR's air pollution control program. In 2015, that will drop to 582 tons during the ozone season with an annual limit of 1,295 tons.

Mercury emissions, Stansfield said, will be limited to 1,211 ounces of mercury per year from 2010 through 2017 for the Sikeston plant. In 2018, that drops to 478 ounces per year.

Currently the Sikeston plant is allowed 1,180 tons of nitrogen oxides.

These emission allowances are a market-based commodity.

"If they emit less they can sell or trade to others," Stansfield said. "It's an attempt to get better reductions over all the power plants by letting some market forces come into play."

The new rules will also allow ease interstate trading of these allowances, Stansfield said.

A credit for one ton of nox emissions during the ozone season have recently ranged from $750-$900, according to Comer. "It's been all over the board," he said.

Comer said the average cost for an annual one-ton allowance is about $3,300.

Unused credits can be "banked" for future use.

"This is all within federal government guidelines," Comer said. "It's not anything out of the ordinary."

The Sikeston plant had to purchase credits for the ozone season for the first time in 2007 "due in part to plant availability," Comer said. "We've been running wide open."

With new regulations going into effect soon, the Board of Municipal Utilities is deciding on what emission controls to install or the purchasing of credits to meet tightened restrictions in coming years.

"We know we're going to have to do some things, but we don't know the extent of what we're going to have to do," Comer said.