Pasadena Beyond Coal - FAQ
QUESTIONS AND ANSWERS:
PASADENA'S CONSUMPTION OF COAL-BASED ELECTRIC POWER, AND ITS FUTURE ALTERNATIVE OPPORTUNITIES
1. How much energy does Pasadena use on a normal day, and what is the city's peak usage?
A. On an average day the residents, businesses, and institutions in Pasadena consume electricity at the rate of approximately 200 MW per hour .Consumption is lower in the winter and higher in the summer, sometimes exceeding 300 MWh on hot days when many air conditioners are running at maximum capacity.
2. What is the principal source of Pasadena's energy supply?
A.Pasadena currently gets over 60% of its power from the Intermountain Power Project (IPP), a large coal-burning power plant constructed in the 1980s near Delta, Utah. Each of the plant’s two power units was initially designed to produce 820 MW of electricity; each has since been upgraded to produce 950 MW. The plant’s total capacity of 1900 MW makes is one of the largest fossil fuel plants in the United States, and it ranks 20th in the nation in carbon dioxide emissions.
Although this publicly-owned power plant is a legal entity created by the State of Utah, the majority of the financing, design, and construction was undertaken by the Los Angeles Department of Water and Power. Five other Southern California cities joined Los Angeles in the project: Pasadena, Glendale, Burbank, Riverside, and Anaheim. These 6 cities put up 75% of the financing and consume 75% of the plant's output. The other project participants, which have a 25% share, include 23 Utah cities, 6 Utah cooperatives, and a Utah investor-owned utility.
The Southern California participants and their percentage shares of the project are:
Los Angeles 44.6%
Anaheim 13.2%
Riverside 7.6%
Pasadena 4.4%
Burbank 3.4%
Glendale 1.7%
The Intermountain Power Project also includes a converter station and two transmission lines: the Southern Transmission System (STS) which brings power to Southern California, and the Northern Transmission System (NTS) which conveys power to the Utah entities.
3. What are the other sources of Pasadena's energy supply?
A. According to city's recently adopted Integrated Resource Plan (IRP), the other sources of power and their percentages are: (a) hydroelectric power from Hoover Dam (7%), nuclear power from Palo Verde Power Plant in Arizona (5%), Magnolia Power Plant [a natural gas combined cycle plant completed in 2005] in Burbank (8%), High Winds Power Facility in Solano County (1 %), Ormat Geothermal Plant in Imperial County (1 %), Tulare and West Covina Landfill Gas Projects (6%), and the city's Broadway natural gas steam generating plant (3%) and four natural gas turbines (3%) located on Glenarm Avenue on the southwest border of the city .
4. What are Pasadena’s obligations under its contracts with the Intermountain Power Project?
A.Each of the six participating Southern California cities is responsible for making annual payments on 40-year revenue bonds issued when the plant was completed in 1987, and for making payments on 40-year "take-or-pay" contracts to purchase the plant’s power. Each city must pay for its share of the power, whether or not it takes the power.
Pasadena's currently takes 4.4% of the plant's output under its Basic Power Purchase Contract, and takes an additional 2.2% under an Excess Power Sales Contract with the Utah entities. Both contracts run through the year 2027, although the obligation to take additional power under the Excess Power Sales Contract can be reduced if entities in Utah recall some of the power under that contract.
5. What are Pasadena's annual payments to retire its share of IPP's bonds and to take its share of IPP's power production?
A. In Fiscal Year 2008-2009 Pasadena paid $28,579,035 under its Basic Power Sales Contract and was obligated to pay $11,224,43 7 under its Excess Power Sales Contract; however Utah cities recalled about 50% of the Excess Sales Contract power, reducing Pasadena's payment under that contract to $5,332,769. Pasadena therefore paid out a total of$33,911,804 for the power it used from this power plant in FY 2008-2009.
6. Can Pasadena terminate its contracts before they expire in 2027, and if so how?
A. If Pasadena and the 5 other participating cities can find one or more interested buyers for part or all of the contracts, the city could transfer its share in power plant obligations in return for financial compensation. However if the purchaser or purchasers desired to transmit the power to a location other than Southern California or the Utah cities which presently use power from this site, a new transmission line or lines to that location would have to be constructed. Capital would have to be raised to finance any new transmission line, and it would take time to assemble the necessary equipment and personnel to construct the line.
7. Would Pasadena and the 5 other participating Southern California cities yield their rights to receive power over the Southern Transmission System (STS) if they sold their interests in IPP's power plant?
A. That depends. Pasadena and the other cities want to retain rights to transmit power over the STS so that power from renewable energy sources such as wind, solar, and geothermal can be transmitted over the line. As an example, power from the 200 MW Milford Wind Project, a $376 million project in Utah constructed by a private developer jointly financed by 9 major financial institutions, will be transmitted to Southern California via the STS upon project completion in mid-November 2009. The capacity of the STS is currently being upgraded, at a cost in excess of $100 million, by an additional 480 MW in order to carry power from renewable energy projects such as this along its route.
Power from the first phase of the Milford Wind Project is being purchased through a 20-year contract by the Southern California Public Power Authority (SCPP A), a regional energy planning agency, on behalf of the Los Angeles Department of Water and Power (which has a 92.5% share), the City of Burbank (which has a 5% share), and the City of Pasadena (which has a 2.5% share). Expansion of the project to include an additional l00 MW of power, in which Pasadena expects to participate, is currently under negotiation.
COAL AS A POWER SOURCE: CONVENIENT BUT ENVIRONMENT ALLY COSTLY
8. Isn't coal the most reliable energy source?
A. A modern coal-burning power plant, which can take up to 72 hours to start up, is reliable once it is in normal operation. However it contains many components and as it ages it is subject to regular service interruptions for maintenance and replacement of worn-out parts, and to sudden power interruptions due to unexpected breakage of components.
In contrast, a modern natural gas power plant can be started up in as little as ten minutes and has far fewer moving parts than a coal-burning plant. State-of-art combined-cycle natural gas power plants are more reliable than a coal plant. Nuclear, hydroelectric, and geothermal power plants, all of which can be operated 24 hours a day, are also considered reliable energy sources. Although wind and solar power plants are dependent on the forces of nature, siting wind energy plants in areas such as the High Plains where the wind blows a large percentage of the time, and thermal solar plants in desert areas where the sun shines throughout the year, increases their reliability as renewable energy sources, especially if several of these renewable resource facilities are located in a variety of suitable locations.
9. But isn't coal considered the least costly power source?
A. Although at the present time coal is one of the least expensive power sources if measured only in terms of the economic cost of generating the energy produced, this will not be the case once the true costs of regulating carbon dioxide, in the form of a carbon tax or other regulatory controls, are imposed on coal-burning power plants as part of pending Congressional legislation. Carbon dioxide emissions from coal-fired power plants are one of the largest causes of the dramatic increase in greenhouse gases worldwide, which are the leading cause of the rapid increase in global climate change that has taken place in recent years.
When taking all environmental and social costs into consideration, coal is the most expensive power source. In the eastern United States mountain top removal to expose seams of coal has devastating impacts on the natural landscape, on the streams into which the burden from the removal is dumped, and on the property and lives of those who live in and near the those mountains and streams. Underground mining, both in the US and throughout the world, exposes workers to incurable black lung disease (contracted through breathing coal dust) and, even worse, potentially fatal mine disasters.
Sulfur dioxide, nitrogen oxides, mercury, and other pollutants emitted by burning coal are known carcinogens which are poorly regulated in the western United States under existing Environmental Protection Agency regulations. And the great majority of power plants which have installed scrubbers, electrostatic precipitators, and/or baghouses in order to remove a significant percentage of these pollutants from power plant smokestacks dispose of the pollutants into our nation's waterways, which are also poorly regulated by the EPA. (A major article in The New York Times on October 12, 2009, states that "power plants are the nation's biggest producers of toxic waste" and discusses the numerous pollutants disposed of into the nation's waterways in violation of the Clean Water Act, as well as the poor enforcement of that act by EPA.)
10. What quantity of air pollutants are emitted by burning coal at IPP?
A. Source Watch, a collaborative project of the Center for Media and Democracy, reports that IPP, which burns 6 million tons of bituminous and sub-bituminous coal per year, produced 14,451,689 MWh of electricity during 2006. The report states that IPP emitted the following major pollutants in 2006:
Carbon dioxide (CO2) 16,035,530 tons
Sulfur dioxide (SO2) 4,239 tons
Nitrogen oxides (NOx) 28,911 tons
Mercury 226 pounds
A study published in July 2007 by the Environmental Integrity Project, entitled "Dirty Kilowatts America's Most Polluting Power Plants", reports that, of the 378 large fossil fuel plants analyzed in the study, IPP ranked 20th in the amount of CO2 emitted and 12th in the amount of NOx emitted.
A study published in January 2009 by the Institute of Southern Studies reports that IPP produced 333,589 pounds (=166.8 tons) of combustion waste in 2006. According to IPP staff, half of this waste, which includes fly ash and dewatered scrubber particulate matter, is sold to the cement industry, while the remainder is disposed of in a landfill; none is released to a riparian or aquatic environment.
11. How do IPP’s air pollutants affect human activities and endanger public health?
A. Carbon dioxide (CO2) is a major greenhouse gas and has contributed to significant warming of the earth's surface and atmosphere since the start of the modern Industrial Revolution. It is the consensus of knowledgeable scientists who have studied climate change in recent decades that this global warming is a significant contributor to changing weather patterns that have resulted in increased frequency and intensity of drought, rain and snow storms, and hurricanes.
Global warming has also accelerated the rate at which continental glaciers, Arctic Sea Ice, and the Antarctic Ice Cap are melting, resulting in a significant rise in sea levels that over the next century could displace hundreds of people worldwide. Drought in sub-Saharan Africa has intensified the human struggle for life-sustaining resources in such areas as Sudan's Dafer region, and has caused major reductions in water available for human use in Mediterranean climate regions such as western Australia and the American Southwest.
Climate change has direct implications for the residents and businesses of California. Studies by the California Department of Water Resources forecast that global warming will result in less rainfall in the southern part of the state, and that warmer temperatures will cause early melting of the Sierra Nevada snow pack, which is likely to result in more stream flooding in the early spring and less water available for agriculture and urban use in the summer and early autumn.
Since the Colorado River Basin, a major source of Southern California's current water supply, is expected to experience prolonged drought, water supply for this region will be significantly reduced in the future. Strict water conservation measures have already been imposed locally, and these measures are likely to become even stricter in the future.
Sulfur dioxide (SO2) interacts with NOx to form nitric and sulfuric acids which fall as acid rain, damaging lakes and forests and contributing to acidification of soils. Sulfates from SO2 are a major component of fine particle pollution that harms the respiratory and cardiovascular health of those living near power plants.
Nitrogen oxides (NOx) are components of ground-level ozone, which is especially harmful to children and those with respiratory problems. NOx also reacts with other power plant emissions such as ammonia to form fine particles which damage the lungs and cause or worsen respiratory diseases such as bronchitis and emphysema, and aggravate heart disease. In addition, nitrogen oxides are a potent greenhouse gas, adding to global warming, and even reach the stratosphere where they join with chlorine and bromine compounds in weakening the earth's protective ozone layer.
Mercury (Hg) is a highly toxic metal that, when emitted into the atmosphere, settles in lakes and rivers, and from there moves up the food chain to humans, causing neurologic damage.
RENEWABLE ENERGY AND ENERGY EFFICIENCY:
PATHWAY TO ENVIRONMENTAL RESPONSIBILITY
12. Does Pasadena have a plan to increase its use of renewable resources?
A. Pasadena Water and Power (PWP) retained PACE Global Energy, a forward-looking energy
Consultant, in late 2008 to assist the Department in developing an Integrated Resource Plan (IRP). A 10-member Stakeholder Advisory Committee made up of representatives of city departments and the community participated in plan development.
The final 20-year IRP , adopted by the Pasadena City Council on March 16,2009, on recommendation of the city's Environmental Advisory Commission, commits the city to the following major goals by the year 2020: (a) revise the city's Renewable Portfolio Standard (RPS) to increase the usage of renewable energy from its current 9% to 40%, 11/11/09 including 15 MW of local solar photovoltaic power; (b) retire the outdated 65 MW Broadway steam plant and replace it with a comparably sized combined-cycle gas turbine plant; ( c ) reduce the use of coal-based energy from IPP to 23%; (d) implement energy efficiency and demand management programs; ( e ) establish a feed-in tariff system to purchase energy from qualifying renewable technologies; and (f) reduce greenhouse gas emissions by 40%.
13. Is Pasadena currently undertaking steps to increase its use of renewable energy sources?
A. At its meeting on September 14, 2009, the Pasadena City Council authorized PWP to proceed
with negotiations to obtain renewable power from three additional wind, geothermal, and solar sources: Milford Wind Phase II in Utah, Raser Geothermal Generation Project in Utah, and Solar Mission Project in Arizona. PWP continues to participate in efforts of the Southern California Public Power Authority to secure additional renewable sources of energy through that organization's ongoing Request for Proposals (RFP) process, in which private developers are asked to submit proposals for consideration by its member agencies.
PWP is currently increasing its promotion of private solar photovoltaic projects within the city through an energy-saving rebate program authorized by the State of California. At its meeting on November 2, 2009, the Pasadena City Council authorized PWP participation in a feasibility and exploration study for a geothermal power project, on land owned by the Los Angeles Department of Water and Power and the Imperial Irrigation District in Imperial County, that would be directly owned by SCPP A for the benefit of its members. (This is in contrast to many renewable energy projects which are built and owned by private developers).
14. Is Pasadena currently undertaking steps to reduce energy consumption through energy efficiency and energy conservation?
A. The Pasadena City Council has directed that cost-effective energy efficiency be the first
priority resource to meet the city's energy demand load. The IRP includes an objective of reducing energy consumption by 12.5% below expected levels by 2016 through implementing energy efficiency programs, and an objective of reducing peak demand by 5 MW by 2012 through programs that provide customers with information and economic incentives to reduce consumption during peak load periods.
PWP is promoting energy efficiency, especially in the business and institutional sector, via a rebate program and informational seminars. Energy efficiency is one of the most cost-effective ways of reducing both energy consumption and greenhouse gas emissions. A recent report by the business consulting firm McKinsey & Company concluded that investments in U.S. energy efficiency of $520 .billion over the next ten years would generate energy saving of $1.2 trillion.
PASADENA’S ENERGY FUTURE
15. The IRP include plans for construction of a 65 MW combined-cycle natural gas power plant at the city's Glenarm site, scheduled for completion by 2014. What is the purpose of this plant – can’t future energy needs be met through the use of renewable energy sources?
A.This base-load power plant is designed to replace some of the coal-generated power that Pasadena currently purchases from IPP under its existing purchase agreements. The plant will provide a flexible range of operations to complement intermittent renewable energy sources such as wind and thermal solar energy facilities when these remote sources are unable to meet the city’s power demands. Since the plant will be located in Pasadena, it will also protect against transmission line interruptions, thereby increasing power delivery reliability.
On November 2, 2009, the Pasadena City Council took the first step in initiating construction of this plant by approving a 7-year contract in the amount of $3 million with consultant Power Engineering to perform engineering services for the plant. Total project cost is estimated to be $138 million.
16. Wouldn't operation of this plant increase air pollution emissions at this location?
A. Actually there would be significantly less air pollution than that produced by the outdated
Broadway steam power plant, built in 1965, that the new power plant would replace. Although the existing plant also burns natural gas, it does so at a very inefficient rate to produce steam which drives turbines. Its present use is as a "peaker plant", used only infrequently to meet peak demands during times of high energy usage.
The new combined-cycle power plant would be a state-of-the art facility which would burn natural gas to turn turbines directly and would also capture heat generated by the combustion process to produce additional power, so its output of energy per unit of fuel burned would be significantly higher than that of the existing steam plant.
Greenhouse gas emissions per unit of electricity produced from natural gas plants such as this are less that half those a coal-burning power plant. Emissions from the new plant would be strictly regulated by the South Coast Air Quality Management District to reduce green- house gas and other emissions through the use of best available pollution control technology.
17. If Pasadena is successful in implementing the IRP's Preferred Resource Plan over the next 20 years, how much would electric rates increase?
A.The IRP projects a 21% increase over 2008 rates over a 20-year period if the Preferred Resource Plan is implemented. However the rates are projected to increase by 18% even if the current mix of energy sources is maintained; implemented of the IRP's Preferred Resource Plan would add only an additional 3%.
18. How much would rates increase if Pasadena stopped using coal-based power entirely?
A.That would depend on whether or not Pasadena was successful in finding one or more buyers for its existing coal contracts for IPP power. The cost would obviously be higher if Pasadena merely stopped accepting its share of IPP power under its contract obligations, but still had to pay for it, than if the city is able to sell its part or all of its contracts to others.
19. If Pasadena reduced its use of coal-based power or eliminated it entirely, could the city meet its future power needs through the use of natural gas, renewable energy sources, and energy efficiency and demand management?
A.The planned new combined-cycle natural gas power plant to be located here in Pasadena on Glenarm could provide at least 65 MW of base load power to replace that much power from the Intermountain Power Project. In addition, PWP could more aggressively seek to increase its portfolio of wind, solar, and geothermal power projects by increasing its share of power from these renewable energy sources that are being undertaken by SCPP A on behalf of its members.
(Two examples illustrate Pasadena's limited level of participation in recent SCPPA
projects: Although the city of Burbank has a smaller population than Pasadena [108,029 vs 148,126 in January 2008 according to the California Department of Finance], Pasadena has signed up for only a 2.5% share of the Milford I Wind Energy Project in Utah and a 2% share in financing the LA DWP- lID geothermal energy feasibility and exploratory study in Imperial County [ see Question and Answer 13 above], while Burbank has signed up for a 5% share in Milford land a 9.5% share in the Imperial County project. However it should be noted that Pasadena has signed up for a larger share of some other renewable energy projects.)
Another action that Pasadena could and should take is implementation of a Smart Grid and Smart Meters program, which would allow for two-way communication with customers so that they have real-time data to help them conserve energy. The nearby cities of Burbank and
Glendale each recently received a $20 million grant from the U.S. Department of Energy for this
purpose.
20. Should Pasadena residents, business, and institutions be willing to pay higher electric rates if that's necessary to end the city's consumption of coal-generated power, increase its consumption of power from natural gas and renewable energy sources, and implement a more aggressive program of energy efficiency in order to reduce its greenhouse gas emissions?
A.That's obviously a matter of opinion. But the City of Pasadena has long been a leader in enacting and promoting environmentally responsible policies and programs, and has made commitments under the United Nation's Urban Environmental Accords and the U.S. Mayors Climate Protection Agreement.(signed by over 1000 mayors) to reduce its overall energy use, increase its use of renewable energy, and decrease its greenhouse gas emissions.
Major institutions in Pasadena have already undertaken steps in that direction. The California Institute of Technology has shown strong leadership by installing a large bank of photovoltaic solar panels on one of its parking lots and by producing a significant percentage of its electric power at a small combined cycle natural gas plant on its campus.
The most responsible way for Pasadena to meet these commitments and maintain its environmental leadership would be for the city to follow and foster this type of leadership, with the objective of ending its consumption of coal-based electric power at the earliest opportunity.