The Morro Bay Power Plant: Past, Present and Future - Part 2
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(Continued)
To understand the real impact of a new plant, the staff report pointed out, the 17%-33% figures must be considered as a "proxy" for the mortality of "all the other all other 'silent partners' - the small, entrainable life stages of clams, worms, etc. and the phytoplankton and zooplankton of the...Estuary," which are too small for their presence in the plant water to be measured. Therefore, the water sampling that produced the study collected only "a sub sample of all species entrained" (carried into the plant) and demonstrates that the plant's real "impact is on the ecological system" of the entire Estuary.
"This 'take' from a National Estuary that is already impaired and in ecological decline is unnecessary and avoidable," the staff emphasized. Therefore, "Staff finds the applicant's proposed use of once-through cooling causes estuarine losses due to entrainment that are considered significant impacts under CEQA (California Environmental Quality Act) and "will cause adverse impacts to significant biological resources and will not comply with numerous LORS (laws, ordinances, regulations and standards) if the project is approved as proposed."
In addition to the aquatic life taken into the plant and killed, another 74,000 fish (2,522 pounds) and 54,979 macroinvertebrates (794.69 pounds) would die annually after being pinned on screens covering the water intake tubes (called impingement). Anchovies were the most common fish impinged; muscles and crayfish were typical of the macoinverterbrates, the study cited in the staff report said. Consultants to the Regional Water Quality Control Board did not deem these impingement losses to be significant under the federal Clean Water Act, but the CEC staff did under CEQA.
The staff said it was guided by "a number of state and federal policies that stress the importance of protecting the resources in Morro Bay in particular, and in estuaries in general. For instance, in 1994, the Legislature designated Morro Bay as the first State Estuary and stated that it 'recognize[d] the importance of preserving and enhancing Morro Bay and its watershed as one of the state's rare natural treasures.'" Furthermore, "The state of California has lost over 90% of its wetlands and estuaries in the past one-hundred years. The resources of the remaining wetlands and estuaries should be protected to the highest degree possible."
The Environmental Protection Agency, the staff report noted, issued final regulations on power plant cooling in November, 2001, and "found the best technology available (BTA) for new facilities is closed-cycle wet cooling" and issued additional draft regulations for existing power plants in February, 2002, allowing use of closed-cycle cooling to meet the BTA standard. The draft regulations find that "a State may choose to use its own authorities to require dry cooling (a form of closed-cycle cooling) in areas where the State finds its fishery resources need additional protection," the report said.
In conclusion, the report said, "Staff finds once-through cooling to be impacting/damaging to the estuarine environment and that it is not BTA, and recommends that it's use in Morro Bay be significantly reduced or discontinued. Staff finds that BTA for the MBPP is a closed-cycle wet or dry cooling system and recommends that a closed-cycle cooling system be required for the proposed MBPP." In short, "Staff believes that it is preferable to avoid impacts than to attempt to mitigate them after the fact."
CAPE also was involved at every step over three years of analysis of the proposed new plant's biological effects, coordinated and often led by its San Luis Obispo attorney Babak Naficy. Naficy was, at the time, on the staff of the Environmental Defense Center of Santa Barbara, and was assisted by CAPE's own biological experts. One of his briefs to the CEC probably best captured where Duke was coming from: "Duke is not offering to 'modernize' the plant in order to reduce entrainment and impingement. Rather, Duke intends to modernize the plant because newer technology would run 30% more efficiently than the existing plant, translating into a 30% more profit for Duke over and beyond the existing margins. Duke has not offered any evidence to suggest that the design of the plan reflects any effort to reduce the plant's impact on the environment."
The city opposed use of closed-cycle cooling because of expected noise from the 100-foot-tall cooling units and their interference with views of the coast, although the CEC staff found that both the noise and visual impacts would be less than significant.
Facing these arguments for closed-cycle cooling, Duke decided to propose a means of offsetting the impacts documented by its own biological study, even though it claimed the impacts would be negligible. Its consultants designed what was called a habitat enhancement program (HEP) to offset or mitigate the losses of marine life from continued use of OTC. It took nearly a year to complete the HEP.
The HEP would have sought to reduce the sedimentation of the Estuary, which results in loss of water volume, by improving the habitat up Chorro and Los Osos creeks and thereby cutting down on the sediment that flows down them into the Estuary. The purpose, as related to the plant, was to stabilize the amount of water in the Estuary, thereby reducing the loss of volume for fish and other aquatic life to live in. Duke proposed spending about $10 million on the HEP.
It also called for dredging portions of the southern part of the Estuary for the same purpose, although parts of that area are under the jurisdiction of the county and state, and whether either would have supported dredging, especially the Coastal Commission, was never addressed.
In its analysis, the CEC staff said a "nexus" was essential between the HEP and the numbers of marine life in the Estuary to see if it works. Specifically, "this nexus should be increases in larval production of those species impacted by" the use of OTC by the plant. A demonstration project should be undertaken to determine its effectiveness in this regard, the staff said.
There also should be provisions for close monitoring and operation of HEP by an independent non-profit organization, which should begin as soon as the plant is opened, not two years after operations begin, as Duke proposed, its report said. All in all, the staff estimated about $37 million would be required to undertake a well-designed program. However, it emphasized, Duke's money to reduce sedimentation is not essential because other public funding is already available and being applied. As Naficy pointed out in a CAPE brief, "Existing conservation agencies have contributed significantly to solving the sedimentation problem in Morro Bay."
Staff concluded that it "has reviewed the proposed HEP and has identified major and minor concerns with the proposal. Staff does not recommend the HEP as currently proposed as mitigation for the significant impacts of once-through cooling." And it added, "In staff's opinion, avoidance of the impacts of the proposed MBPP by eliminating or avoiding once-through cooling is the only certain way to mitigate the significant adverse impacts of once-through cooling."
Naficy put it bluntly: "Duke has not offered any scientific evidence or studies in support of its hypothesis that creating habitat will result in greater productivity to the degree needed to compensate for the larval entrainment caused by the (proposed) power plant." He quoted scientific studies casting doubt on the effectiveness of such restoration programs.
Then, Duke spent almost another year seeking to exclude the Coastal Commission from the CEC review process after the Commission in December, 2002, held a hearing on the Duke project and voted unanimously to recommend that dry cooling be required if the plant were built. CAPE members spoke in favor of the Commission taking that stand at the hearing. Then-county Supervisor Shirley Bianchi, who represented Morro Bay at the time, endorsed dry cooling in a letter presented to the Commission. She and Morro Bay council member Colby Crotzer were the only public officials to oppose the Duke project using OTC.
The Commission found that the project did not comply with the Coastal Act or the city's Local Coastal Program, which the Commission administers. It said it could not approve the project with OTC because of "significant adverse impacts to the marine resources of Morro Bay," which is designated as Environmentally Sensitive Habitat Area (ESHA) under the Coastal Act. But "a dry cooling system would on balance be most protective of significant coastal resources." It recognized that a plant with dry cooling units would interfere with some views of the coastal landscape, as the existing plant does, but that would be more than offset by the fact "dry cooling will eliminate all adverse marine resources impacts" from a plant there.
Under the state statute governing the CEC, it has the authority to consider such Coastal Commission recommendations and then override them if they are found to be infeasible or more harmful to the environment. But Duke wanted the Coastal Commission completely out of the review process, possibly uncertain how the CEC would rule on the Coastal Commission's recommendations or whether it might give the Commission more authority over the siting of the plant than anyone assumed it had.
Duke filed a number of legal briefs, and the CEC's legal and legislative staffs researched the question of the Coastal Commission's role, going back to the intentions of the Legislature when the controlling statutes were adopted. Ultimately, the CEC would rule in the matter when it issued its final decision on the Duke project in 2004.
With dry cooling having gained support not only from the CEC staff but three other state and federal agencies, Duke for the first time brought up the feasibility of closed-cycle cooling in terms of cost to the plant owner. EPA regulations allowed a requirement of best available technology, such as closed-cycle cooling, to be challenged as to whether the cost would be disproportionate to the benefit, now known as a "cost-benefit analysis." For example, would closed-cycle cooling, if required by the CEC, be justified by the added cost over OTC? Seemingly implicit in the question is whether a plant owner should have to pay more to save more marine life, assuming closed-cycle cooling would be the alternative to OTC.
The CEC staff already had calculated that closed-cycle cooling for the proposed plant would cost about $50 million more net, and a consulting engineering firm agreed. That would have been about 8% above Duke's estimated capital cost of $600 million to build a new plant. What Duke had in mind was not a little more in cost, but a lot more.
During one of the CEC hearings, a Duke official testified the additional cost to install closed-cycle cooling would be $200 million on top of the original $600 million plant cost for a total of $800 million. Duke blamed the higher cost on the need to install larger cooling units for the plant - twice the size that the CEC staff had estimated were needed.
But after analyzing why Duke's projected cost was so much higher, the staff concluded that Duke was claiming the proposed plant would require a "design that it says would be able to produce 1,200 MW (megawatts) at an ambient temperature of 85ยบ." (As a general rule, the higher the air temperatures, the larger and more costly the cooling units must be.)
This was puzzling to the staff in view of the fact that, a) Duke had previously filed documents estimating that the air temperature in Morro Bay would reach 85 degrees only 26 hours a year or 1% of the hours in the year and, b) now Duke was claiming it would reach 85 degrees a good part of the time.
Secondly, the staff submitted meteorological data showing that the ambient temperature in Morro Bay is 64 degrees. "The supposition that the facility must be capable of generating 1,200 MW at 85 degrees is irrational," a staff report said.
But it wasn't just the size of the cooling units that would drive up their cost. Duke also argued that in order to transport the larger units to the new plant site through a new back entrance to the existing plant, it would be necessary to remove - and then replace - a number of ancillary buildings that serve the plant and enable it to operate. Besides being costly to remove and replace, Duke argued that shutting down those buildings for a period of time would interrupt operations of the existing plant - a plant it regarded as still very viable with much operating time left, despite its age. The CEC staff contended the old plant's days were numbered. As it turned out, the staff was right - two of the plant's generating units were mothballed even before the CEC issued its final decision in 2004.
But a few months before that decision, a historic federal court decision was issued in New York that ruled the U.S. Clean Water Act prohibits use of restoration measures, like habitat enhancement, to compensate for the killing of aquatic life by all new power plants using OTC.
"...we note that Congress rejected a proposed amendment to section 316(b) (of the Clean Water Act) that would have explicitly allowed restoration measures," the Second Circuit Court of Appeals said. Naficy argued the way the decision was written, it would apply to the Duke case under review by the CEC. But an appeal to the U.S. Supreme Court by the power industry was possible at that point, so it was not final- although potentially Duke now faced an insurmountable obstacle to building a new plant that used water from the Estuary.
When the CEC review of the plant project started in 2000, it looked like Duke would get the new plant it wanted. It had the money, the pull at both the local and state levels, and California- supposedly- badly needed more energy in the wake of the 2000-2001 electricity-shortage "crisis."
And then all this poured out:
- facts documenting public health risks from smokestack emissions,
- the revelation about what a power plant had been doing to the Estuary for almost 50 years and what a new one would continue to do for 50 more and even worse,
- the CEC's own veteran staff and three other state and federal agencies opposing continued use of OTC,
- Duke's arguments for a habitat enhancement program to compensate for fish kills that was called into serious question,
- its claims of huge additional costs for closed-cycle cooling seemingly refuted,
- and now a new legal framework for siting power plants that could settle the OTC debate once and for all in established law.
As a result, Duke's chances didn't look so favorable on the eve of the CEC's final decision on the proposed new plant. But then came some big surprises, which altered this whole picture and will be described in the concluding Part Three of this series, in next month's issue of the Journal.
Jack McCurdy is co-president and co-founder of CAPE. This article was not written on behalf of CAPE and does not necessarily reflect its views.
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