Forging ahead on the governor's vow to bring more electricity to power-starved Californians, a state energy panel Thursday recommended the speedy restart of two gas-fired generators owned by AES Corp. in Huntington Beach. But several conditions were attached.
Power produced by the units would have to be sold in California, a permit would be limited to five years, and the company would have to pay $1.5 million for independent studies of whether its plant is causing ocean pollution or harming wildlife.
The generators could be online by July, according to Energy Commission staff, but area residents would have to tolerate construction noise 20 hours a day to meet that goal.
A public hearing will be held April 9 to discuss the 204-page decision, and the final vote by the full Energy Commission is expected April 18.
Huntington Beach officials were mostly pleased with the proposed decision, noting that it went a long way toward addressing the environmental and community concerns they have been raising since the project was placed on a fast track.
If the plant is identified as drawing bacteria back to shore--leading to the costly closure of beaches in 1999--AES would have to pay whatever costs are deemed necessary to fix problems tied to the plant.
"Sounds like our hard work paid off," City Councilwoman Debbie Cook said. "And in today's climate, it's probably the best we could have hoped for."
Assistant City Administrator Bill Workman agreed that Huntington Beach got nearly all the concessions it considered crucial, except one.
"In terms of disappointments, it looks like the plant is going to be retooled on virtually a 24-hour basis," he said. "We're very concerned that our local ordinance regarding limits on noise and construction have been overridden."
He said that concern was not a terrible trade-off considering the permit would expire in 2006, a restriction the city "really pressed for."
AES site manager Ed Blackford said he had not had time to read the full report, but that the company strongly opposes a five-year limited permit.
The company, California's largest private generator, has vowed all along that it would safeguard against environmental problems in Huntington Beach and remedy any future problems caused by plant operations.
With a combined output of 450 megawatts, the company's two 40-year-old units represent about 10% of the 5,000 additional megawatts Gov. Gray Davis has promised to bring into service to meet an expected energy shortfall this summer.
Of all the applications being considered for fast-track approval, the AES project is the only one that involves the retooling of existing generators. The remaining applications before the Energy Commission are for new peaker plants, which can produce large amounts of power in short bursts, and operate under much more restrictive time periods. So far, two of those have been approved.
Blackford also said AES disagrees with a recommendation that it curtail the use of a peaker unit at the Huntington Beach plant that has been working on overdrive during the energy crisis.
The commission panel found that the peaker unit is exceeding air quality emission standards and should not be allowed to operate in concert with the other units unless the state declares a Stage 3 emergency. The commission proposed that the peaker be either shut down or retrofitted in December 2002, once more power plants are brought on line elsewhere.
The two offline Huntington Beach units, formerly owned by Southern California Edison, were slated for demolition before the energy crisis deepened in December. That month, AES applied for the fast-track permit to add the generators to two already in operation at the site.
That application was rejected shortly before the governor issued executive orders directing the Energy Commission to consider accelerating approvals to bring power plants into service. In the meantime, scientists at UC Irvine concluded that the power plant--which already uses 300 million gallons of ocean water each day as coolant--might be combining with ocean currents to pull in sewage discharged miles offshore by the Orange County Sanitation District.
Much of the local opposition to restarting the generators has centered around that theory. Water polluted with bacteria forced the closure of much of the Huntington Beach shoreline during the summer of 1999. City officials worry that if the plant fires up two more generators, the amount of ocean water needed for cooling will double--and perhaps the pollution as well.
"I wish we could have gotten the water quality issues resolved," City Councilwoman Shirley Dettloff said. "But I understand that they need to move forward if they're going to be on line by this summer."
Dettloff and other city officials were also disappointed that the Energy Commission dismissed their request that AES establish a $14-million fund to guarantee it would clean up any ocean and beach pollution tied to the plant.
"It's just added insurance," Dettloff said. "Without that funding, we're depending on AES making sure the conditions are met."
But the Energy Commission panel found that AES would "have a sufficient income stream from project operation to pay for necessary mitigation on a pay-as-you-go basis."
Jack Caswell, the Energy Commission project manager assigned to the AES case, said he believes the proposed decision strikes the best balance possible between meeting California's energy needs and accommodating the concerns of the local community.
"I think we've handled everything we can, within reason, for AES to provide generating capacity for summer 2001," he said.
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A state energy panel recommends that the plan to restart two Huntington Beach gas-fired generators proceed on a fast track, under a variety of conditions.