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East Kentucky Power Cooperative Agrees to Halt Plans for Smith Coal Plants

Case Updates:

November 18, 2010

As part of a landmark agreement with Sierra Club, other public interest groups, and individual ratepayers, East Kentucky Power Cooperative will immediately halt plans to build its two proposed Smith coal-fired power plants in Clark County. EKPC will no longer seek the permits it needs to proceed with construction. Instead, the cooperative will commit $125,000 toward a collaborative effort in which plaintiff groups, EKPC and its member co-ops, and other parties will work together to evaluate and recommend new energy efficiency programs and renewable energy options in Kentucky.

Several factors contributed to the decision not to move forward with the proposed plants, including lower than expected demand for electricity, a moratorium imposed by the Bush Administration on low-cost federal loans for coal plants, and sharply rising construction and operating costs for new coal plants. Studies commissioned by the public interest groups participating in the agreement concluded that a combination of clean energy technologies would be a cost-effective way to meet EKPC’s demand, while also reducing financial risk to customers, generating jobs throughout the region, and benefiting public health and the environment.

June 22, 2010

On June 22, the Kentucky Public Service Commission initiated an investigation into whether or not there is still a need for EKPC's proposed Smith coal plant, which was approved by the Commission in 2005. The Commission will investigate the need for the plant, whether it is the least-cost option for meeting new demand, and what impact building it will have on the cooperative's rates and financial condition. The Commission has ordered the cooperative to submit data regarding the need for the plant, its energy conservation and efficiency efforts, updated information on the progress and cost of the plant, and the implications to the cooperative's finances if it builds the plant on schedule, delays the plant, or moves to other options.

November 12, 2009

On October 29, a coalition of individuals and organizations, including Sierra Club, filed a formal complaint with the Kentucky Public Service Commission, requesting that the Commission revoke the certificate authorizing construction of East Kentucky Power Cooperative’s (EKPC) Smith coal plant. The coalition asserts that economic, regulatory, technological and financial conditions have changed dramatically since the project was approved more than two years ago; energy demand has dropped, prices of alternative, cleaner forms of energy have dropped, and capital costs for the project have increased significantly, among other things. The combined effect of these changes means the proposed coal-fired power plant is unnecessary and poses an unacceptable and avoidable risk to ratepayers.

As Lauren McGrath, Sierra Club’s Beyond Coal Campaign Kentucky Representative, said, "[w]e want to see EKPC make an investment that safeguards public health and the region's economy. Today, EKPC has other options. There are many new funding mechanisms for energy efficiency and renewable energy programs now that did not exist in 2006. EKPC could pursue these channels more aggressively and, with help from the PSC, help its members by shifting to clean, affordable energy solutions." 

Details and Documents:

Coalition of ratepayers and public interst groups reach accord with EKPC
November 18, 2010, Sierra Club et al. Press Release

Sierra Club et al. Complaint

News Articles:

Electricity Co-Op Chooses "New Power" Over Coal Energy and Emissions
November 18, 2010, Justmeans

More Info:

See other "Stopping the Coal Rush" cases.