A newly-filed bill seems designed to stop GVEA from shutting down the Healy 2 coal plant.
Healy 2 is unreliable, expensive and highly polluting. If we close any plant, it ought to be this one.
Representative McCabe recently filed HB 256, which prevents a utility from selling any partly or fully state-funded power plant without first offering to sell it to another utility AND getting the approval of the legislature. This seems targeted at Golden Valley Electric’s plan to close the Healy 2 coal plant in at the end of 2024. Coal has a high impact in general, and Healy 2 in particular is a terrible plant. If GVEA is willing to close it, the legislature shouldn’t get in the way.
Most of the Railbelt’s electricity comes from natural gas, and with the Cook Inlet gas crisis, that’s most of what I’ve been talking about. But 12% comes from coal, all of it through Golden Valley Electric Association (GVEA), which doesn’t have access to gas directly. While gas power has decreased over the last decade, coal power production has actually increased.
All data in this post comes from public EIA, EPA, and RCA filings.
Despite providing a small fraction of total Railbelt electricity, coal plants are responsible for over a third of direct CO2 emissions.
Two of the coal plants are in Fairbanks (Aurora and a small one at the University), and provide local heat as well as power. For the analysis shown above, combined heat and power plants are considered to have lower emissions per unit of electricity than power-only plants. Burning coal produces the same amount of CO2, but some of that is attributed to the heat production, which would otherwise have been produced by burning something. Therefore, the power-only coal plants, Healy 1 and Healy 2, have the highest emissions per kWh on the Railbelt.
The discussion about closing coal plants started with Healy 1. It’s an old plant (1967), and needed an expensive pollution reduction system (selective catalytic reduction system, or SCR) to meet EPA requirements. GVEA decided to spend $30 million on upgrading that system to avoid having to shut down the plant.
Healy 2 already has an SCR, and faced no such immediate requirement. But Healy 2 is unreliable and expensive, and GVEA decided to close it instead. Between 2018 and 2021, Healy 1 had a reliability of 91%, whereas the reliability of Healy 2 was only 59%.
This makes Healy 2 one of the most expensive plants on the Railbelt to run. The coal that fuels it is in line with current natural gas costs, but the rest of the operating costs are vastly higher.
Healy 2 is one of those quintessential Alaska boondoggles. It was built in 1998 as a $300 million demonstration project by the Department of Energy’s Clean Coal technology program (which kicked in $120 million), AIDEA ($150 million), the Alaska legislature ($25 million), Usibelli coal mine and GVEA ($10 million together). It used an experimental new technology to burn waste coal that never really worked. The plant never successfully passed its testing phase and shut down by 2000. GVEA and AIDEA were in a legal dispute over the plant, which GVEA ended up agreeing to buy in 2009. HEA was originally going to be part of that deal, but after public outcry and an overturning of the board, they pulled out. GVEA finalized the deal in 2013, but didn’t get Healy 2 into regular commercial operation until 2018.
GVEA’s self-imposed deadline to close Healy 2 at the end of 2024 is approaching quickly, and I don’t know if they are on track to do it or not. One of the elements of that plan involved contracting for a large amount of wind power (which is in progress). Another element involved buying more gas power from southern utilities (which depends on uncertain gas availability). But if they do close Healy 2, the legislature shouldn’t stand in the way.