Evergreen Energy Inc EEE

Kansas & Coal Fired Power:

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Kansas Needs Coal Fired Power & We Can Make it Cleaner with K-Fuel: Neufeld, Sebelius clash over coal plants -------------------------------------------------------------------------------- Feb 5 - McClatchy-Tribune Regional News - Scott Rothschild Journal-World, Lawrence, Kan. House Speaker Melvin Neufeld on Tuesday said that both proposed coal-burning power plants in western Kansas must be built and that Gov. Kathleen Sebelius' offer to allow one plant was not made in good faith. Sebelius vehemently denied the charge. "The governor carefully found out what the bankers would not allow a bond for and wouldn't sell, and that's what she suggested," said Neufeld, R-Ingalls. "That is clearly an indication that I'm (the governor) going to stop this thing dead cold and I'm going to propose absolutely something that can't be built, can't be financed," he said. But Sebelius' office said Neufeld was off the mark. "Gov. Sebelius absolutely made the offer in good faith," said her spokeswoman Nicole Corcoran. And Corcoran said Sebelius' offer reflected the reality of coal-burning plant construction across the nation, was economically feasible and provided enough power for Kansas. "It's time Kansans start asking who truly stands to gain from a project seven-times larger than what we actually need," Corcoran said. The comments came as two legislative committees are hearing measures that would allow two 700-megawatt coal burning plants near Holcomb. Under the plan, 85 percent of electricity produced by the plants would be used by out-of-state customers, while about 200 megawatts would be sold to Kansans. In October, the Sebelius administration rejected the $3.6 billion plants, citing concerns about the annual emission of 11 million tons of carbon dioxide and its effect on climate change. The legislation being considered would reverse that decision and also install CO2 rules. But Sebelius and environmentalists say those proposed rules have such wide loopholes they would invite even more coal-burning plants to Kansas. Sebelius said she tried to compromise with plant developer Sunflower Electric Power Corp. by offering to support one 660-megawatt coal-burning plant that would be able to implement CO2 reduction technology. She said such a plant would take care of current and future power needs in western Kansas and represented a compromise. "The framework of this proposal seeks to find a middle ground between all parties concerned and allows for the construction of one power plant that is reasonable and sensible in terms of scope and size," she said. Sunflower Electric rejected that proposal. Neufeld and Sunflower officials maintain both plants must be built to make the plan financially viable. Earl Watkins Jr., Sunflower president and chief executive, said that under the two-plant proposal, Sunflower could receive $95 million in "development fees" to operate the plants for the other owners, Tri-State Generation and Transmission Association of Colorado and Golden Spread Electric Cooperatives of Texas. "These upfront payments provide for the equity necessary for Sunflower's 200-megawatt portion of the plant, which will cost a total of about $540 million," he said. But Sebelius said a smaller proposal is economically sound, and has been replicated recently in other states, such as Montana, Arkansas and Oklahoma. "If the base-load needs in western Kansas are only 200 megawatts, this extra power would allow Sunflower to sell the additional power to either Tristate or Golden Spread, which was anticipated in the two-plant proposal, helping to lower the energy costs and repay some of the financing," Sebelius' office said. But Neufeld said the construction of both plants, with the accompanying transmission lines, will increase Kansas' ability to export wind energy to other states. Environmentalists, however, say transmission lines will be built without the need for more coal-fired power. Neufeld said he believes there is room to negotiate with Sebelius on the current legislation, which may be voted on in committee this week. Asked if he would try to have the House approve the bills next week, he said, "I'll count noses."