New State Policy on Power Plant Restrictions: Full of Leaks?

By Jack McCurdy

Morro Bay is at the forefront of statewide opposition by 30 environmental, commercial, and sport fishing organizations and some state legislators against a proposed new state policy aimed for the first time at stopping the use of estuary, bay, and ocean water to cool power plants, including the 55-year-old Morro Bay Power Plant.

The reason: the policy has so many loopholes and other weaknesses that it could illegally allow gas-fired and nuclear plants to continue to use that water for cooling virtually indefinitely, resulting in the continued killing of billions of fish and aquatic life and damaging the marine-dependent economies of coastal communities in California. Federal law now prohibits that cooling process, and the only unresolved question is how soon must it be phased out.

Regarding nuclear plants, the proposed policy appears to be even more lax than federal policy was under President George W. Bush, comments filed by opponents said.

In the case of the Morro Bay plant, it already could be in compliance with the new state policy without the owner, Dynegy, lifting a finger because the language of the policy is so unclear. In addition, a previous version of the policy required the plant to stop using water from the Morro Bay National Estuary for cooling by 2015, but the revised new version, depending on how it is interpreted, could allow it to go beyond that compliance date. The plant, as now configured, cannot function without using Estuary water for cooling.

The opponents include the Coastal Alliance on Plant Expansion (CAPE) and the city of Morro Bay. This is the second time both have called for revisions rather than approval of the policy by the State Water Resources Control Board, which is scheduled to consider adoption on May 4 in Sacramento. CAPE, a nonprofit citizens group, which has been monitoring plans to build a new and larger Morro Bay Power Plant for 10 years, and the city both opposed an earlier version of the policy last December.

The policy's procedural, statutory, and legal faults, cited in comments filed by the 30 organizations, could deter the board from enacting the policy as now drafted, especially since possible litigation is mentioned in those comments.

In addition to the 30 state and local organizations and nine members of the state Senate and Assembly, another 8,928 individuals submitted
comments to the water board opposing the policy, which would serve to regulate use of estuary, bay or ocean water for plant cooling, called once-through cooling (OTC). The main comments were submitted by a coalition of groups coordinated by the California Coastkeeper Alliance.

CAPE contends the policy "is structurally flawed due to incomplete, unclear, and confusing language and requirements, defects which would render the policy inoperable and unenforceable."

What CAPE is most alarmed about in allowing OTC to continue is that it has been going on for more than a half century and has been shown to contribute significantly to the depletion of the Morro Bay National Estuary's marine life. CAPE's fear now is that OTC could cause the Estuary to collapse, threatening tourism, property values, and the viability of the business community. It has happened to an estuary on the East coast, Mount Hope Bay, due to impacts on its fish from the Brayton Point Station in Somerset, Massassuchetts, resulting in its waters becoming a "dead zone" marked by few if any marine life in it.

The Morro Bay National Estuary is the only estuary in California designated an Environmentally Sensitive Habitat Area that is being used as a source for power plant cooling water and "is already impaired and in ecological decline . . . ," the California Energy Commission staff declared about eight years ago. At that time it was reviewing Duke Energy's application to build a new plant that would have used more Estuary water and killed more marine life. Duke abandoned its plans for the Morro Bay plant, sold the plant to Dynegy, and left the state.

The continued use of OTC by existing power plants in California, which has been going on for up to 60 years, would violate the U.S. Clean Water Act, which requires "best technology available" (BTA) to cool plants. This does not include river, lake, or ocean water, as interpreted in an historic 2007 federal appellate decision that is now federal law. The debate is over the timing of a phase-out of OTC, or at least it was, until the latest version of the policy, which now also makes compliance dates uncertain. Even if the policy's phase-out requirements were enforced, it would allow some plants up to 14 years to end OTC.

The coalition's 41 pages of comments urge a complete overhaul of the proposed policy, which has been nearly five years in the making. Over those years, through a number of versions, it has been severely weakened through strong lobbying by power plant owners.

A prime example of how the policy would allow plants to avoid ending OTC is the use of two tracks for taking steps to phase it out. All plants would be placed in Track 1, which would require a minimum 93% reduction in the water intake flow rate for each plant unit (Morro Bay has four, two of which operate.) But plants then can opt on their own to be placed in Track 2, which has lower reduction requirements.

"No agency review is required of permit applicants who choose Track 2, which is also now considerably weaker than Track 1," the coalition said in its comments. "Most plants will likely use Track 2 instead of Track 1." On top of that, plants in Track 2 can obtain waivers of their compliance dates with no clear limits on such waivers.

Therefore, the comments said, "Track 2 can no longer be justified as even 'comparable to' BTA," which the law requires.

CAPE also pointed out that the proposed policy is contradictory in setting 2015 as the deadline for the existing Morro Bay Power Plant to stop using OTC, since the policy also states that the plant "is not required" to help meet state energy needs after 2011. The plant owner, Dynegy, announced last fall that it would plan to stop using OTC in 2015, considering that was and still is the deadline in the draft policy. But a spokesman now says the corporation is reviewing its options.

Also up in the air is the lease that Dynegy has from the city to use ocean-front land for an outfall channel through which cooling water is discharged by the plant into Estero Bay. That lease expires in 2012, and Dynegy has asked the city for a two-year extension to allow the plant to continue to operate until then. The lease currently pays the city $750,000 a year, $250,000 of which must go to the harbor department. No decision has been made by the City Council on the lease extension request.

The city of Morro Bay's comments said it "continues to have grave concerns" about the draft policy because it "is vague and unclear, allowing opportunities for power plant owners to exercise options to avoid achieving the Board’s stated goal of "protecting the state's coastal and estuarine waters.'" Therefore, the policy "will not comply with the Clean Water Act."

The policy calls for the Diablo Canyon Power Plant to terminate use of OTC in 2024, the most distant deadline of all the 19 existing coastal plants, but the coalition commented that "the policy allows unspecified and essentially unlimited loopholes for the nuclear facilities," which include Diablo and the San Onofre Nuclear Plant in San Diego County. "In this respect, it appears that this policy may be giving nuclear facilities even more than the U.S. EPA (Environmental Protection Agency) under President George W. Bush was willing to give," the comments added.

The other main points in the coalition's comments:

--The proposed policy does not require BTA to cool power plants but makes it "optional."
--The proposed policy allows power plants to comply with the policy by virtue of past measures to reduce OTC, even though those measures do not meet BTA requirements.
--The water board illegally relinquishes its assigned authority to regulate OTC by delegating virtually all power to determine compliance deadlines to other state agencies, namely the California Independent System Operator, the California Energy Commission, and the California Public Utilities Commission on matters involving reliability of the state grid, which means provision of adequate energy to the public. None of those agencies has environmental protection as a primary statutory responsibility.
--The policy allows mitigation of environmental impacts from OTC through habitat restoration in lieu of BTA, which specifically is not permissible at present under federal law.
--The policy significantly dilutes monitoring requirements that are essential to determine whether progress towards BTA and ecosystem health is being made by power plants to achieve compliance.
--The policy fails to comply with new state climate change requirements being administered by the California Air Resources Board by allowing the old, polluting power plants to operate longer than necessary. In addition, the policy's assessment of state needs for energy--focused on allowing existing plants to operate longer than justifiable--fails to consider the rising availability and state funding support of alternative sources, such as solar power, which was recognized last year as a feasible alternative to conventional power plants by the state Energy Commission.
--The board has failed to respond to the large number of comments submitted by organizations in the past, which is required by state law.

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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