Coal Takes a Back Seat as a Source of Cheap Power

Coal Takes a Back Seat as a Source of Cheap Power

Huge $6 Billion Project Delayed

Darrell Delamaide,  energybiz.com

THE DECISION IN SEPTEMBER BY OLD DOMINION ELECTRIC COOPERATIVE TO DELAY its ambitious $6 billion Cypress Creek project threw the future of coal-fired electricity generation in the U.S. further into doubt.

The cooperative, based in Richmond, Va., acknowledged that uncertainty about restrictions on carbon emissions played a role in the decision. But it claimed that the main reason for the delay was the sluggish economic recovery and slower-than-expected growth in demand for electricity.

Permit filing was to be delayed 18 to 24 months, so that the two-unit 1,500-megawatt station would now come on stream in 2018 at the earliest, and more likely 2020, instead of 2016, as originally planned when the project was announced in January 2008.

“This adjustment to our timeline does not in any way reflect a change in our goal of building the Cypress Creek Power Station to provide a reliable source of affordable electricity to meet the growing demand for energy,” David Hudgins, the cooperative’s communications director, said in September.

But the delay came after a controversy extending from tiny Dendron, a town of 300 between Richmond and Norfolk where the plant is to be sited, across the nation about investing that kind of money in new coal-generation capacity when the future of carbon regulation and electricity demand is so uncertain.

An April 2009 report on the Cypress Creek project by Synapse Energy Economics noted that more than 30 proposed coal-fired plants had been cancelled in the previous three years, and more than 40 others had been delayed. While some proposed plants had been approved, regulatory commissions in North Carolina, Florida, Virginia, Oklahoma, Washington, Oregon and Wisconsin had rejected proposals.