The Flambeau River Papers mill in Park Falls, Wisconsin, uses combined heat and power to cut energy costs. (Photo by Wisconsin DNR via Creative Commons)
The hulking pulp and paper mills built many decades ago in Wisconsin, Michigan and other Midwestern states have had their share of environmental impacts.
But the mills were decades ahead of the game in adopting technology now seen as an effective tool to fight greenhouse gas emissions and environmental impacts. That would be the use of combined heat and power (CHP, also known as cogeneration), promoted by President Obama with a 2012 executive order and lauded by environmental and energy efficiency advocates.
Like any industry that generates electricity onsite, paper and pulp mills can take the heat from their generators to create steam that can be used to generate more electricity. More importantly, the heat can also be used directly for mills’ industrial processes, including for drying pulp.
“We were doing this before people were using the term ‘sustainability,’” said Jerry Schwartz, senior director of energy and environmental policy for the American Forest & Paper Association, a trade group. “A lot of it made economic sense.”
The Presque Isle power plant in Marquette, Michigan, receives a subsidy to continue operating amid grid concerns. (Photo by Adam Shoop via Creative Commons)
Scores of coal-fired power plants have been retired and taken off-line in recent years, and coal plant retirements are likely to continue or accelerate as deadlines for federal pollution regulations loom and states respond to the recently-proposed EPA carbon reduction plan.
Clean energy advocates and environmentalists typically cheer the closing of coal plants. But sometimes power plants – whether coal, natural gas or nuclear – are crucial to providing stability on the grid, even if their electricity is not needed to meet demand.
Hence regional transmission organizations (RTOs), the entities which oversee the grid and electricity markets for different regions, have the power to order a plant to keep running even if it is not financially viable.
Koda Energy, a combined heat and power plant in Shakopee, Minnesota, runs on biomass. (Craig Lassig for Midwest Energy News)
Sean Casten and his father, Tom Casten, could be called the country’s family dynasty of combined heat and power.
CHP, also known as cogeneration, is the under-appreciated practice of capturing and using waste heat from power generation to make clean electricity and steam, greatly increasing efficiency and reducing greenhouse gas emissions.
Sean Casten is president and CEO of Recycled Energy Development LLC (RED), an Illinois firm that constructs and runs CHP operations for industrial partners. RED’s chairman is Tom Casten, who has more than three decades under his belt in waste energy recovery.
RED’s most prominent current project is transforming the 125 MW utility complex at Kodak’s Eastman Business Park in Rochester, New York, which provides power and heat to more than 40 tenants and owners. RED is turning the century-old coal-fired station, which already includes co-generation with waste heat, into a highly efficient gas-fired CHP plant.
A pipeline failure caused an explosion in Fairport Harbor, Ohio in 2011. AP Photo/The News Herald, Michael Allen Blair. (click to enlarge)
Despite ongoing safety concerns and the urging of state regulators, the Ohio legislature has so far passed up an opportunity to impose tougher penalties on those who break safety rules for natural gas pipelines.
Ohio House Bill 483 had a provision to double penalties for safety violations when it was introduced in March. However, the version passed by the Ohio House of Representatives last month eliminated that section.
While fines for violations are rare, resource-strapped regulators say they provide a critical incentive for compliance with safety rules.
HB 483 is part of the Ohio’s Mid-Biennium Budget Review. The Ohio Senate Finance Committee reported the bill out this week, and the Senate passed it on Wednesday. Any differences between the House and Senate versions will require resolution by a conference committee.
Although most of HB 483 addresses other subjects, proposed and deleted energy issues touch on public safety and other concerns.
Stacy A. Cook, Vice President and General Manager of Koda Energy, at the combined heat and power biomass plant in Shakopee, Minnesota. Photo by Craig Lassig for Midwest Energy News. (click to enlarge)
When airborne dust ignited a silo explosion last spring at a biomass cogeneration plant in Minnesota, it was a major setback for the pioneering energy facility.
But the blast’s impact on Koda Energy’s bottom line was a blip compared to the prolonged strain of operating in an energy market that’s been turned upside down by fracking and cheap natural gas.
When a tribal government announced a partnership in 2006 to build the $60 million plant with one of the world’s largest malting companies, Rahr Malting Co., they were coming off a winter when spot prices for natural gas topped $13 per million Btu.
By the time the power plant began operating in May 2009, natural gas prices had plunged below $4. A few years later, in the spring of 2012, spot prices would briefly dip below $2.
Yellow flags mark the location of utility pipelines near Cleveland, Ohio. (Photo by Kathiann M. Kowalski)
Ohio’s natural gas utilities are replacing more than 11,000 miles of the state’s aging gas pipe mains, in an effort to reduce the risks for catastrophes like last month’s gas explosion in New York City.
However, three of Ohio’s four large natural gas utilities are only about a fourth of the way into their 20- and 25-year replacement programs.
And while few would argue about the need for new pipelines, the programs have hefty price tags. By the time all four programs finish, Ohio consumers will pay approximately $6 billion.
This solar array near Slayton, Minnesota provides power for Xcel Energy. Geronimo Energy is proposing similar projects to help meet peak energy needs. (Photo by CERTs via Creative Commons)
A proposed $250 million distributed solar project appears to have held its own in a Minnesota regulatory process that put it in competition with three natural gas options.
The Minnesota Public Utilities Commission on Thursday ordered Xcel Energy to pursue a power-purchase agreement with a Twin Cities solar developer to meet part of its projected generation shortfall later this decade.
Geronimo Energy’s 100 megawatt solar proposal will be paired with one or more natural gas projects, to be determined later, to provide up to 500 megawatts of new generation Xcel expects to need by 2019.
The agreements would be subject to further review by the PUC.
“It’s a big win for us,” said Betsy Engelking, a vice president at Geronimo Energy. “We participated in an RFP against natural gas and we were selected.”
(Photo by Damian Gadal via Creative Commons)
In deregulated Midwestern states, many residential customers and whole towns and cities – through municipal aggregation – are now able to choose an electricity supplier other than their utility.
Shopping around for an alternative natural gas supplier, however, is much less common, and many customers likely don’t know they have the option to switch gas suppliers even years after deregulation laws made it possible.
Alternative gas suppliers and energy marketplace companies – like ChooseEnergy, which launched its residential natural gas switching services in Illinois and Ohio recently – say that consumers can save money by shopping around for a gas plan.
Some consumer advocates and energy experts, meanwhile, say that differences between the gas and electricity sectors mean that customers have much less to gain by switching to an alternative gas supplier. In fact an analysis by the Citizens Utility Board (CUB) in Illinois shows that a great majority – 88 percent – of customers have actually lost money by switching natural gas plans.
(Photo by Michael Krigsman via Creative Commons)
After a three-year pilot program that won praise from state officials and environmental groups, Minnesota’s largest natural gas utility is proposing to walk away from a concept known as revenue decoupling.
CenterPoint Energy, which is in the midst of a contested rate case, said in a Jan. 31 regulatory filing that it will no longer seek approval for a permanent decoupling mechanism it proposed last summer.
That proposal faced opposition from the Minnesota Attorney General’s Office, which argued that it would confuse customers and shift too many costs and risks onto residential and small business ratepayers.
Michael Vickerman is program and policy director of RENEW Wisconsin.
By Michael Vickerman
As this latest blast of arctic air slides away from the Upper Midwest, now is a good time to take stock of the conventional wisdom that grips natural gas markets today.
The Energy Information Administration (EIA) last week reported another large weekly withdrawal of natural gas–230 billion cubic feet (bcf)–from underground inventories. While this is a big number, it is well short of the record-setting 287 bcf withdrawal reported two weeks earlier. This week’s report may eclipse that number.
The heavy demand for natural gas this winter leaves inventories at their lowest levels for this time of year since 2004. Even if temperatures returned to normal this February and March, we could finish the heating season with only one-third the volume in storage back in early November.
In fact, we’re on track to pull 26 trillion cubic feet (tcf) out of storage this heating season, a volume likely to exceed all the natural gas extracted from domestic sources last year (an estimated 25.5 trillion cubic feet).
Remember the extraordinary surplus that accumulated in the winter of 2011-2012? It’s ancient history now. Without a moment’s thought to what was happening, we managed to Hoover through every last cubic foot of ballooning inventories that in 2012 sent gas prices plunging down to levels not seen since 2002. One month into 2014, the pendulum has clearly swung over to the deficit side of the supply-demand equilibrium.