LG&E Energy

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Louisville Gas and Electric (LG&E Energy) is a wholly-owned subsidiary of E.ON U.S. LLC, a diversified energy services company that is a member of the E.ON AG family of companies. E.ON is the world's largest investor-owned utility company. LG&E is a regulated electric and natural gas utility, based in Louisville, Kentucky, serving Louisville and 16 surrounding counties.

In June 2010, Pennsylvania Power and Light (PPL) announced plans to buy two Kentucky utilities for $7.6 billion from German power company E.ON AG: Louisville Gas & Electric and Kentucky Utilities, giving PPL an additional 1.2 million customers.[1]

Existing Coal Plants

LG&E operates the following coal-fired power stations:[2]

Plant State Year(s) Built Capacity
Cane Run Station KY 1962, 1966, 1969 645 MW
Mill Creek Station KY 1972, 1974, 1978, 1982 1,717 MW
Trimble County Generating Station KY 1990, 2011 1,316 MW
Roanoke Valley Energy Facility NC 1994, 1995 240 MW

Proposed Coal plants

LG&E has proposed the construction of an additional coal-fired unit at the Trimble power station: Trimble County Generating Station 2. The new plant (Unit 2) would burn Illinois Basin high sulfur bituminous coal and would be built by Bechtel Power. It received a $125 million tax credit from the federal government’s 2005 EPACT Qualifying Advanced Coal Program. In Sept. 2007, the Sierra Club reported that the Trimble air permit had gone back to the draft stage. [3] In Fall 2008, the Federal EPA supported the legal challenge that Kentucky violated the Clean Air Act in issuing state permits to the Trimble coal plant and now state officials in Kentucky must “correct” the permit to be more restrictive.[4]

Proposed coal unit closures

According to long-range planning documents filed in mid-April 2011 with the Public Service Commission, LG&E Energy and Kentucky Utilities Company are making initial plans to retire coal-burning units at three aging power plants by 2016, including the Cane Run Station in western Louisville, KU's Green River Generating Station in Central City in Western Kentucky, and KU's Tyrone Generating Station in Versailles, which has already been mothballed temporarily. A PPL spokeswoman for the two companies, Chris Whelan, said: “This is not a final decision," calling the planning document “a snapshot in time” to keep state regulators up to speed on the company's long-range thinking. In all, 979 megawatts of coal-burning capacity would be retired in 2016, while the two utilities would add 2,721 megawatts from natural gas — though it's not clear yet where the new gas turbines would be. The utilities currently produce about 8,000 megawatts of electricity.[5]

In September 2011, LG&E said in filings with the Kentucky Public Service Commission that it plans to replace its Cane Run coal plant with a 640 MW natural gas-fired plant by 2016, to be built at the same site. LGE and Kentucky Utilities reportedly also asked the commission to approve the purchase of Bluegrass Generation Co’s 495 MW natural gas-fired power plant, to replace their Green River Generating Station and Tyrone Generating Station.[6] On May 3, 2012, both the gas conversion and purchase of the Bluegrass gas plant were approved by the Kentucky Public Service Commission.[7]

Pollution controls

In a Nov. 10, 2011 settlement, Louisville Gas & Electric and Kentucky Utilities would be able to recover $2.25 billion from their nearly 1 million ratepayers to install pollution controls on their largest coal-fired power plants. Most of the environmental upgrades are slated for the 2,225-MW Ghent and 1,717-MW Mill Creek plants, as well as 547-MW Unit 1 at the Trimble County plant. Along with the two PPL subsidiaries, others who signed the agreement included Attorney General Jack Conway, the trade group Kentucky Industrial Utility Customers, Sierra Club, Natural Resources Defense Council and groups representing low-income customers.

LG&E and KU asked the PSC in May 2010 for permission to make $2.5 billion in improvements at the coal plants under an environmental surcharge law passed by the General Assembly in 1992, in response to Congressional approval of the 1990 Clean Air Act Amendments. As part of the November 2011 settlement, the utilities, in a concession to environmentalists, agreed to defer the planned construction of a fabric filter or "baghouse" on Units 1 and 2 at the 1,720-MW E.W. Brown plant to capture particulates, a project estimated to cost $225 million. LG&E and KU are barred under the settlement from resubmitting a request for the project before July 1, 2013, "unless finalized changes in the proposed utility MACT rules, future finalized ambient air quality standards, or other regulations finalized after the date of this agreement establish new environmental requirements for Brown Units 1 and 2," the settlement says.

The settlement "means we can go forward with our environmental cost recovery," said company spokeswoman Chris Whelan.[8]

Coal waste

On EPA list of 44 "high hazard" coal ash dumps

In response to demands from environmentalists as well as Senator Barbara Boxer (D-California), chair of the Senate Committee on the Environment and Public Works, the EPA made public a list of 44 "high hazard potential" coal waste dumps. The rating applies to sites at which a dam failure would most likely cause loss of human life, but does not include an assessment of the likelihood of such an event. Kentucky has 6 sites, all of which are owned by E.ON subsidiaries.[9]

LG&E's Cane Run Station was included in the EPA's official list of Coal Combustion Residue (CCR) Surface Impoundments with High Hazard Potential Ratings.[10] To see the full list of sites, see Coal waste.[11]

Coal ash and Cane Run

In November 2011, Louisville Gas and Electric disputed sampling performed by the Louisville Metro Government that showed coal ash was present on homes near the company's Cane Run Station. Since the summer of 2010, LG&E produced results of two different coal ash types of tests, and the results were contradictory. In October 2011, Metro Government analyzed its own samples and found fly ash on a home that was washed only three weeks earlier. LG&E responded by releasing new data that suggested negligible quantities of ash. The company is allowed to emit a certain amount from its smokestacks, but the city said if dust poses a nuisance to an industry’s neighbors and limits their right to enjoy their property, the city can require the company to take remedial measures. Terri Phelps of the Air Pollution Control District says the agency stands by its results and will likely issue a notice of violation to LG&E.[12]

EPA denies LG&E ash permit

In May 2012, the EPA denied a wetlands destruction permit from Louisville Gas & Electric to store 1 million tons of coal ash along the Ohio River. According to the EPA, the ash would have damaged streams, wetlands, and ponds within the watershed.[13]

History

"In 1838, investors formed Louisville Gas and Water to provide gas-fired street lighting mandated by Louisville's city fathers to deter crime. The company sold gas from its local coal plant to fuel the gaslights. In 1842, the company dropped plans to build a waterworks and changed its name to Louisville Gas. In 1890, Louisville Gas amended its charter to buy stock in electric companies, and it acquired control of Louisville Electric Light. In 1913, through the merger of Louisville Gas, Louisville Lighting (founded in 1903) and Kentucky Heating, Louisville Gas and Electric (LG&E) was formed."[14]

"In 1989, the firm founded LG&E Energy Corp. In 1998, LG&E Energy acquired KU Energy, which owned neighboring utility, Kentucky Utilities Company, and it entered into a 25-year lease of Big Rivers Electric's generating facilities. These two transactions more than doubled the size of LG&E Energy."[14]

"UK-based Powergen bought LG&E Energy in 2000, and in 2001, Powergen agreed to be acquired by Germany's E.ON. The deal was completed in 2002. In 2003, E.ON transferred LG&E Energy from Powergen to another subsidiary, E.ON US Holdings."[14]

Contact Details

Website: http://www.eon-us.com/lge/default.asp

Articles and resources

Related SourceWatch articles

References

  1. "PPL spent $400,000 on lobbying in 1st quarter" Bloomberg BusinessWeek, June 24, 2010.
  2. Louisville Gas and Electric, "LG&E Power Plant Information", Louisville Gas and Electric website, accessed June 2009.
  3. "Stopping the Coal Rush", Sierra Club, accessed January 2008. (This is a Sierra Club list of new coal plant proposals.)
  4. "Fighting Pollution from Aging Coal Plants" Environmental Law and Policy Center, August 12, 2009
  5. James Bruggers, "LG&E, KU may retire coal-fired units" The Courier-Joural, April 24, 2011.
  6. "Three coal-fired power plants to be replaced by natural gas" Power Engineering, Sep. 15, 2011.
  7. "PSC OKs natural gas plant to replace coal-fired facility on Cane Run Road," IndyStar, May 4, 2012.
  8. "Settlement would let LG&E/KU recover $2.25 billion to clean up coal plants" Washington Platts, Nov. 11, 2011.
  9. Shaila Dewan, "E.P.A. Lists ‘High Hazard’ Coal Ash Dumps," New York Times, June 30, 2009.
  10. "Coal Ash Reports" Environmental Protection Agency, September 2009.
  11. Fact Sheet: Coal Combustion Residues (CCR) - Surface Impoundments with High Hazard Potential Ratings, Environmental Protection Agency, June 2009.
  12. Erica Peterson, "LG&E Dismisses Metro Government Coal Ash Sampling; Releases New Data" WFPL News, November 1, 2011.
  13. "Coal Ash Dumps Across the Nation Are Looking to Expand," Earth Island Journal, June 11, 2012.
  14. 14.0 14.1 14.2 "About LG&E" LG&E Energy Website, September 2009.

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