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East Kentucky Power Cooperative

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East Kentucky Power Cooperative
Type Municipal Cooperative
Headquarters 4775 Lexington Rd.
Winchester, KY 40391
Area served KY
Key people Bob Marshall, CEO
Industry Electric Producer and Distributor
Products Electricity
Revenue $700.0 million (2007)[1]
Net income Loss of $46.0 million (2005)
Employees 635 (2005)
Website EKPC.com

East Kentucky Power Cooperative, Inc. (EKPC) operates as a not for profit generation and transmission utility in Kentucky. EKPC operates as a parent cooperative that produces wholesale power for its 16 member co-ops that in turn service more than a half-million homes, farms, and businesses throughout Central and Eastern Kentucky. The company provides its services through coal plants, renewable energy plants, peaking units, hydro power, and transmission lines. East Kentucky Power Cooperative, Inc. was founded in 1941 and is based in Winchester, Kentucky.

Power portfolio

Out of its total 2,708 MW of electric generating capacity in 2005 (0.25% of the U.S. total), EKPC produces 67.9% from coal, 31.7% from natural gas, and 0.3% biomass. All of EKPC's power plants are in Kentucky.[2]

Existing coal-fired power plants

EKPC had 9 coal-fired generating stations in 2005, with 1,839 MW of capacity. Here is a list of EKPC's coal power plants:[2][3][4]

Plant Name State County Year(s) Built Capacity 2007 CO2 Emissions 2006 SO2 Emissions
Spurlock KY Mason 1977, 1981, 2005 1279 MW 5,293,000 tons 38,877 tons
Cooper KY Pulaski 1965, 1969 344 MW 2,290,000 tons 16,652 tons
Dale KY Clark 1954, 1957, 1960 216 MW 1,371,000 tons 6,562 tons

In 2006, EDPC's 3 coal-fired power plants emitted 9.0 million tons of CO2 and 62,000 tons of SO2.

Proposed Smith plant

The financial condition of the cooperative has been weaning. In 2006, EKPC failed to meet one of the financial ratios required by its loan covenants. It had lost money during 2004 and 2005 and narrowly had a profit in 2006. It has since applied for and received approval for two rate increases and has stated it plans more. In April 2010, EKPC withdrew its request with the state Public Service Commission (PSC) for approval of up to $900 million in private financing for a new coal plant, Smith Station. The withdrawal request was made shortly before a review of the EKPC's financial health.[5]

On June 15, 2010, the Sierra Club and Kentuckians for the Commonwealth, represented by Earthjustice, challenged a decision by the federal Rural Utilities Service (RUS) to allow the EKPC to waive federal debt obligations and seek private financing for the Smith plant. According to the groups, RUS gave the approval without thoroughly analyzing EKPC’s perilous financial situation or environmental impacts and risks of the new coal plant--a decision that leaves taxpayers exposed to unnecessary financial risk.[6]

Smith plant cancelled, cooperative to seek renewables and energy efficiency

On Nov. 18, 2010, EKPC entered into an agreement with Kentuckians For The Commonwealth, Kentucky Environmental Foundation, the Sierra Club, three individual co-op members, the Kentucky attorney general, and Gallatin Steel (EKPC’s biggest industrial customer) to halt plans for the Smith plant by abandoning the permits needed to proceed with construction. The cooperative also committed $125,000 toward a collaborative effort in which the public interest groups, EKPC and member co-ops will work together to evaluate and recommend new energy efficiency programs and renewable energy options.[7]

According to Kentuckians for the Commonwealth, "a number of factors contributed to the decision to not to move forward with the proposed plants, including lower than expected demand for electricity, a moratorium imposed by the Bush Administration on low-cost federal loans for coal-burning power plants, and sharply rising costs associated with building and operating new coal plants. In June 2010, the Public Service Commission opened an investigation to determine if proceeding with the $819 million project was cost-effective and necessary. Studies commissioned by the public interest groups participating in this agreement concluded that a combination of clean energy technologies would be a cost-effective way to meet EKPC’s demand, while also reducing financial risk to customers, generating jobs throughout the region, and benefiting health and the environment."[7]

East Kentucky Power Cooperative Settlement

Kentucky Riverkeeper looks into the Dale Power Station's impact on water

On July 2, 2007 the U.S. Department of Justice (DOJ) and the U.S. Environmental Protection Agency (EPA) announced that East Kentucky Power Cooperative, a coal-fired electric power plant, will spend about $650 million in pollution upgrades and another $750,000 penalty in a civil suit for violations of the New Source Review requirements of the Clean Air Act at its Spurlock Power Station, Cooper Power Station and Dale Power Station.

“Today’s settlement is another example of the Justice Department’s continued commitment to aggressively enforcing the Clean Air Act,” said Ronald J. Tenpas, acting assistant attorney general for the Justice Department’s Environment and Natural Resources Division. “The emissions reductions from this settlement are substantial, and we are pleased that East Kentucky finally agreed to resolve this litigation on acceptable terms and bring its facilities into compliance with important provisions of the Clean Air Act.”

The EPA and DOJ in 2004 filed a lawsuit against the utility for "illegally modifying and increasing air pollution at two of its coal-fired power plants."

The settlement states that the utility will install pollution control equipment to reduce emissions of sulfur dioxide (SO2) and nitrogen oxide (NOx) by more than 60,000 tons per year.[8]

Articles and Resources

References

  1. East Kentucky Power Cooperative, Hoovers, accessed July 2008.
  2. 2.0 2.1 Existing Electric Generating Units in the United States, 2005, Energy Information Administration, accessed April 2008.
  3. Environmental Integrity Project, Dirty Kilowatts: America’s Most Polluting Power Plants, July 2007.
  4. Dig Deeper, Carbon Monitoring for Action database, accessed June 2008.
  5. Scott Sloan, "East Ky. Power delays coal plant" Kentucky.com, April 16, 2010.
  6. "Kentucky Coal Plant Funding Challenged: Power cooperative owes US taxpayers over $1 billion, yet avoids federal environmental oversight" CommonDreams, June 16, 2010.
  7. 7.0 7.1 "Coalition of ratepayers and public interest groups reach accord with EKPC" Kentuckians For The Commonwealth, Nov. 18, 2010 Press Release.
  8. "U.S. Announces Clean Air Act Settlement with Electric Utility," U.S. EPA, July 2, 2007

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