Power plants face a setback

Lawmakers want a state panel to delay a decision on whether Duke Energy can build new coal plants

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CORRECTION

A Business section article Wednesday wrongly characterized the financing cost of a power plant proposed by Duke Energy. The story should have said Duke Energy has said that financing costs of the proposed Cliffside project would add several hundred million dollars to the estimated $3 billion price tag.

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Duke Energy's contentious bid to build two coal-fired power plants west of Charlotte hit another snag Tuesday.

Several state lawmakers, seeking time to consider options to a major power plant, said they will ask the state Utilities Commission to delay for three months a decision on Duke's plans. The agency had been expected to rule this month.

The unusual public move by lawmakers to influence a case pending before the utilities commission, an independent regulatory body, is the most recent development that has vexed Duke Energy's bid to add 1,600 megawatts of coal-fired power generation to meet energy demand in the Carolinas.

In November, the company acknowledged that its cost estimate for the plants had soared 50 percent, from $2 billion to $3 billion. And in December, an energy consultant submitted a report concluding that the state could get 10 percent of its electricity from renewable sources and efficiency programs with a minimal effect on customer bills.

Durham Democrat Paul Luebke, Wake County Democrat Jennifer Weiss and others said Tuesday that Duke's coal plant proposal should be put on hold while the General Assembly considers legislation that would require the state's public utilities to derive at least 10 percent of their electricity from renewable sources such as wind, solar or animal waste. Bills were recently introduced in the state House and Senate. If the state adopts such an energy policy, building a major power plant might be unnecessary, the lawmakers said.

The legislators have about 10 signatures in support of a delay, and they are soliciting more support from colleagues, with plans to submit their request to the utilities commission Thursday, Luebke said. Other lawmakers who participated in Tuesday's announcement were Rep. Susan Fisher, a Buncombe County Democrat, and Sen. Eleanor Kinnaird, a Democrat representing Orange and Person counties.

"There is no reason to go ahead with these plants," Kinnaird said.

Scott Gardner, Duke Energy's manager for regulatory and government affairs, said the company is opposed to a delay. The company is urging quick approval of the coal-fired units so that it can lock in on negotiated prices for equipment and labor before costs rise again.

Gardner said Duke has already made its case in public filings and public hearings and now needs to proceed and build the units.

The company has maintained that renewable sources and efficiency programs are insufficient to offset the need for the coal plants.

"Our demand ... is reaching a point of concern for us," he said. "Locking in on pricing contracts is critical, and the more you put that off, the more volatile pricing becomes down the road."

If built, Duke Energy's proposed Cliffside units would be the state's first major power plant project in a quarter century.

The timing of the Cliffside application is awkward for Duke, as global warming causes more alarm and momentum builds for energy alternatives.

Global opposition rises

Three weeks ago, the Intergovernmental Panel on Climate Change -- established by the United Nations Environment Programme and the World Meteorological Organization -- said that global warming is indisputably caused by mankind's reliance on fossil fuels, including coal-fired power plants.

The proposed Cliffside project would release 11.5 million tons of heat-trapping carbon dioxide a year, equal to nearly 1 million automobiles.

The Cliffside proposal is also opposed by the state attorney general, who has said that Duke should be allowed to build only one of the coal-fired units, for a total capacity of 800 megawatts.

The lawmakers also said that Duke might be low-balling its cost estimates.

They want Duke to open its books to disclose how it calculated costs, what options were considered and how renewable energy sources and conservation programs could help.

Duke last month acknowledged that financing costs would add at least several hundred million dollars to the price tag, but critics of the proposed power plants contend that the project would likely cost upward of $4 billion.

The cost of the new coal plant would be passed on to Duke Energy customers.

"We don't think the people of North Carolina have any idea what it would cost them if this plant were approved," Luebke said. "This is particularly important because this state has never given alternatives to power plants a chance."