The five-year-old Sierra Club lawsuit against the city of Holland and its coal-burning power plant has finally ended.
A settlement to end all active litigation between the environmental organization and the Holland BPW has been announced by both parties, with the agreement including a timetable for phasing out the use of coal as a fuel at the James De Young power-generating facility.
The city decided a year ago to scrap its plans to invest millions in a major expansion at the power plant involving a cleaner burning technology using coal. On Dec. 4, the utility was granted an air emissions permit from the Michigan Department of Environmental Quality for the new combined cycle gas electric generating plant it will start building in spring 2015.
The Holland BPW also agreed to a partial payment of the Sierra Club’s legal costs in fighting the case in federal court. The environmental group filed suit in December 2008, alleging the city’s publicly owned power plant was violating the federal Clean Air Act.
The BPW said those legal costs will be largely paid by insurance the utility carries to cover these kinds of contingencies. The BPW said the settlement does not contain any admission of fault, wrongdoing or liability on the part of Holland BPW.
The Sierra Club in the settlement agreed to end its litigation against the Holland BPW and not to contest the air emissions permit issued for the city’s new gas-fired generating facility.
“The agreement ends the costly litigation our community has faced and allows us to continue forward with our plan for building a reliable, affordable and sustainable energy future,” said David Koster, general manager of the Holland BPW.
“This is a critical move toward Holland’s energy future,” said Jan O’Connell, energy issues organizer for the Sierra Club Michigan Chapter. “We applaud the city’s decision to protect public health and the environment.”
Holland BPW plans to phase out the use of coal at De Young’s Unit 5 by early 2016. The phase-out of coal use in Units 3 and 4 will begin in 2020 and be completed by the end of 2023. A statement from the BPW said the timetable for phasing out coal provides the utility with flexibility for managing the transition away from solid fuel in a way that best meets the needs of the community.
Bob Vande Vusse, a member of the Holland City Council who serves as its liaison with the BPW, said the original power plant expansion plan, for which a permit had been issued, would have involved a cleaner, advanced method of burning coal to generate steam, called circulating fluidized bed, or CFB, technology.
“It was a promising technology at the time but quite honestly, the economics of electricity production seem to have shifted in the last few years, and gas became much more economical than it was in prior years,” said Vande Vusse.
He added that “many utilities are switching over to gas-fired combustion turbines,” mentioning Wolverine Power Cooperative’s news in mid-December.
Since 2006, the Cadillac-based generating company had planned to build a 600 megawatt plant at Rogers City, also using the CFB technology. It issued a brief statement Dec. 17 stating it was ending development of that project after years of legal moves to stop the plan. The Michigan DEQ had even denied Wolverine a permit for the proposed plant in 2010, claiming the company had not demonstrated a need for it. A judge overruled the state, however, and the permit was issued to Wolverine in 2011.
Vande Vusse said the Wolverine situation is “just another testimony to the changing economics of electrical generation.”
In its announcement, the Sierra Club said it conducted air pollution modeling in 2011 that allegedly showed the James De Young power plant was emitting pollution at 3.5 times the limit the EPA says is required to protect public health. The announcement also states, “Thanks to the actions Holland is taking, the community can expect to experience fewer asthma attacks and ER visits, as well as heart- and lung-related ailments.”
The Holland BPW’s plans are for an entirely new 114-megawatt generating plant at Fairbanks Avenue and Fifth Street on a 9.7-acre site purchased by the city this year. A BPW spokesperson said the base cost for the new plant was initially estimated at $182 million but is now thought to be closer to a $200-million-plus project.
As part of its determination to go green, Holland has contracted with Indiana Michigan Power Co. to buy 15 megawatts of power from a new 125-turbine wind farm it near Elwood, Ind. The wind farm’s total output at peak wind conditions is 200 megawatts.
The Sierra Club said Holland has “taken several steps on its own to move beyond coal” independent of the legal settlement, which includes a second power purchase agreement with a wind facility under construction in Gratiot County.
“I am relieved that the coal plant issue is settled,” said Larry Spitzley, Holland resident and Sierra Club member. “It should now be easier to focus on the Holland Community Energy Plan. I’m especially excited about part of the plan that may make energy audits and affordable improvements available to people here. We’re on the way to becoming a world-leading, energy-efficient city.”
The Sierra Club’s Beyond Coal Campaign aims to replace coal with clean energy like wind, solar and energy efficiency.
The Holland Board of Public Works is a community-owned enterprise providing electric generation and distribution, water, wastewater treatment and broadband utility services to nearly 28,000 business and residential customers.