Traverse City Record-Eagle

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November 28, 2012

Coal plant's future in question

TRAVERSE CITY — A coalition of Michigan electric utilities announced plans to invest at least $130 million in a Marquette power plant, a move that raises questions about the future of a proposed new coal plant on the shores of Lake Huron.

Cadillac-based Wolverine Power Cooperative has not officially axed construction of the Rogers City plant, but the cooperative will acquire a minority interest in Wisconsin Energy Corporation's Presque Isle Power Plant, Wolverine Communications Director Nancy Tanner said Tuesday.

Wolverine agreed to spend between $130 million and $140 million retrofitting the plant's five coal-fueled units with air-quality control equipment in exchange for the partial ownership.

Wolverine invested more than $20 million in the Rogers City plant before emission rules passed by the federal Environmental protection Agency late last year effectively stalled the project.

Wolverine supplies seven utility cooperatives and corporations — including Cherryland Electric Cooperative — with power.

Tom Van Pelt, president of Cherryland's board of directors, said the cooperative budgets funding for power supply projects through a small charge on each customer's bill.

Cherryland paid for less than 20 percent of the $20 million sunk into the Rogers City coal plant, money Van Pelt said was well-spent, regardless of the project's completion.

"The coal plant didn't get built there and it probably won't, but the money still opened new doors for us," he said.

Cherryland General Manager Tony Anderson agreed. He said Wolverine learned much from the stalled Rogers City proposal.

"Had we not spent that money, we wouldn't be in the game for the (Presque Isle) plant," he said.

The Presque Isle agreement will keep Cherryland rates consistent for the next 20 years, its officials contend.

"Keep my lights on and keep my prices cheap. This accomplishes both things," Anderson said.

State officials in 2010 denied a permit for the proposed 600-megawatt Rogers City coal plant. A state judge overturned the denial in January 2011.

Andrew Armstrong, a staff attorney with the Environmental Law and Policy Center, said Wolverine's new proposal proves the cooperative never needed the Rogers City plant.

"It is time for Wolverine to abandon this costly project," Armstrong said.

Wolverine currently generates power at plants in Belleville, Burnips, Gaylord, Hersey, Tower and Vestaburg. Marquette will join that list, assuming several state and federal agencies approve the joint-venture agreement.

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