Kansas coal dispute seen as important for national policy

TOPEKA | Whatever course the U.S. takes on global warming in the next few years, national groups expect a dispute in Kansas over two proposed coal-fired power plants to play a crucial role.

Democratic Gov. Kathleen Sebelius' administration has blocked the plants' construction since October over their potential carbon dioxide emissions. The Republican-controlled Legislature is trying to clear the way for them and strip her top environmental regulator of some of his power.

Nationally, the party has portrayed Sebelius as a rising star, but in Kansas even some fellow Democrats have split with her on energy policy. Legislators have passed two bills to make sure the plants are built, and she's vetoed both. Supporters are within one vote in the state House of being able to override her.

The coal plants have been a target for national environmental groups for months, but large energy companies have also jumped into the debate. Legislators, on a spring break, plan to reconvene April 30, and the issue will top their agenda.

Environmentalists fear a veto override will hinder national efforts to reduce greenhouse gases linked by many scientists to climate change. Bruce Nilles, director of the Sierra Club's national anti-coal campaign, said building the plants will guarantee lucrative markets for coal for a half-century.

The American Coal Council worries that if the decision to block the plants stands, it will become a precedent for other states' regulators. Spokesman Jason Hayes said it would also inspire more aggressive attempts to regulate CO2.

"The ramifications are so huge that they're mind-boggling," Hayes said.

The two plants would be built by Sunflower Electric Power Corp., outside Holcomb, about 200 miles west of Wichita, the state's largest city. Sunflower and a sister company serve about 400,000 customers in western Kansas.

Sunflower is relying on two partners, fellow cooperatives in Colorado and Texas, to help finance the $3.6 billion project, and its partners initially would receive most of the new power. The new plants could generate enough power to meet the peak demands of 700,000 households.

Sunflower expects the plants to be the cleanest in Kansas. But they still could produce up to 11 million tons of CO2 a year.

Sunflower applied in February 2006 for an air-quality permit from the Kansas Department of Health and Environment. Even some environmentalists predicted early on that Secretary Rod Bremby would grant it because of the project's perceived economic development benefits.

Instead, Bremby rejected the permit and described his action as a first step toward reducing greenhouse gas emissions. Sunflower filed a legal challenge now before the Kansas Supreme Court, then turned to legislators for a quicker resolution.

Critics contend Bremby overstepped his legal authority. They note that Kansas still has no written rules on CO2 _ and none are under consideration.

"He's making it up as he goes along," said Brian Moline, chairman of the Alliance for Sound Energy Policy, a group Sunflower helped form after Bremby's decision.

Bremby said Kansas law gives him broad authority to protect the environment and public health. He also relied upon last year's U.S. Supreme Court decision declaring that CO2 is considered a pollutant under federal laws that are the basis of Kansas' air-quality laws.

"I'm not a zealot," he said in an interview. "There's a lot of emerging information that it would have been irresponsible to ignore."

Bremby's decision was significant in the larger, national debate over climate change because both sides have said it appears to be the first time a state has denied an air-quality permit specifically over CO2.

"He's basically thrown away all the old matrixes, the old frameworks, that were used to determine whether a coal plant would go forward," Hayes said.

The decision also was notable because of Kansas' heavy reliance on coal-fired power plants. The state received 73 percent of its electricity from such plants in 2006, according to federal statistics.

That's made regulating CO2 an unpopular idea among legislators. Nilles said Bremby's decision took Kansas from being a laggard to being a leader among states in attacking climate change.

Lobbyists working the issue have reported spending more than $789,000 in the last six months, most of it on advertising and other efforts to build outside pressure on legislators. That's more than all lobbyists disclose in a typical year.

The players include Peabody Energy Corp., based in St. Louis, the world's largest private coal company, which has largely financed one group's $113,000 effort. On the other side, Chesapeake Energy Corp., of Oklahoma City, the nation's largest natural gas supplier, funded another group's $406,000 in newspaper ads.

A few legislators remain skeptical of the science linking greenhouse gas emissions to climate change. But more prevalent is a view that Kansas would damage its economy by not leaving the issue to the federal government.

Environmentalists dispute the argument, but many legislators believe blocking coal-fired plants will force utilities into more expensive alternatives _ and cause electric rates to skyrocket.

"Does Kansas want to be in the position of being the leader in exorbitant energy costs, just so that we can say that we're going to save the world?" said Senate President Steve Morris, a Republican who supports Sunflower's project.

Meanwhile, many environmentalists believe prevailing in Kansas is important in pushing the nation away from fossil fuels.

"To have a state like Kansas stand up to the coal industry really threatens them after 100 years of running our energy sector in America," Nilles said.