Cleaner-air rules mean Westar rate increases

New federal rules to reduce toxic emissions from coal-fired power plants will cost Westar Energy ratepayers $1.5 billion — maybe more — a company official said Tuesday.

The impact on monthly bills was not immediately available and the cost will be spread over years, but, "It's going to cost more for electricity, no doubt about it," said Bill Eastman, Westar's director of environmental services.

After years of delays and false starts under both Democratic and Republican administrations, the Environmental Protection Agency is close to finishing two measures to reduce pollution from coal-fired power plants.

Health experts say the pollution reductions will save thousands of lives every year by sparing people asthma attacks, heart attacks and other health problems.

Coal-dependent power companies that face big bills for new equipment in response to the EPA rules are calling for more time, arguing that electric rates will rise, harming households and industries.

One of the rules, expected in final form as early as today, would force states in the eastern half of the country to reduce pollutants that travel hundreds of miles to create dangerously bad air days in other states.

The other rule, due in November and the subject of much wrangling, will be the first national requirement to reduce mercury, lead, arsenic and other toxic pollutants from coal-fired power plants.

"Pollutants such as mercury, arsenic and particulate matter shorten or reduce the quality of Americans' lives and put at risk the health and development of future generations," EPA Administrator Lisa Jackson said in recent testimony on Capitol Hill.

Jackson said the health benefits would far outweigh the power industry's costs.

Kansas plant costs

Westar, Kansas' dominant power company, has some upgrades under way already and may need to implement others as the new regulations are finalized and phased in over three years, Eastman said.

The current estimated cost for the company's three coal plants:

* $650 million for Westar's share of the LaCygne Energy Center, which the company shares with Kansas City Power and Light

* $450 million for the Jeffrey Energy Center near St. Marys

* $380 million for the Lawrence Energy Center

The costs will go onto consumer bills through an environmental cost recovery rider, a mechanism for the company to collect its costs of complying with pollution regulations.

On May 27, the Kansas Corporation Commission approved a request from Westar to recover $56.7 million on its 2011 rider to pay for improvements made last year.

Westar is already working to fit its power plants with baghouse systems to catch particulates, which should take care of the lead and arsenic, Eastman said.

"Mercury's a bit of an outlier," he added, explaining that it escapes in a gaseous form that has to be captured a different way.

To get that, Westar will need to design a system to inject activated carbon — the same substance used in home water filters — into the process.

Mercury sticks to the carbon, which will be disposed of at a landfill with the ash from the power plant, he said.

Cleanups required

While other industries have been required to make the same cleanups under federal law over the past 21 years, the power sector has gotten special consideration because of its importance to the economy.

Coal-fired power plants today are the largest source of mercury, arsenic and other hazardous substances in air pollution.

The EPA's proposed rule aimed at reducing pollution between states is a court-ordered revision of a Bush administration rule from 2005. The EPA proposed a new version last August. Companies would be required to comply in 2012.

The EPA's plan to cut toxic pollution, including mercury, is getting most of the attention. Not all power companies oppose it. Some, particularly those that use cleaner fuels such as natural gas, have publicly supported it. In addition, some with coal-burning plants already have invested in the pollution controls, often prompted by state laws.

The EPA says that about 44 percent of the nation's more than 440 coal-fired power plants haven't installed the pollution-control equipment they'll need.

There are 84 hazardous air pollutants from power plants, including acid gases, dioxins, lead and other metals, and mercury. Many are carcinogens. Many also are linked to childhood developmental problems. The best-known is mercury.

Mercury settles in water and accumulates in fish. Ingesting it can cause developmental birth defects and damage a child's memory and ability to learn. Mercury also damages the kidneys and liver.

Scott Segal, the director of the Electric Reliability Coordinating Council, a group of power companies that opposes the rules, said the benefits from reducing mercury were "tiny in comparison to costs" and that there'd be few benefits from reducing acid gases, lead, arsenic and other toxic emissions.

A study for the American Lung Association earlier this year reported that toxics other than mercury, such as arsenic and lead, have greatest impact near a plant. The report cited damage to human health and the environment from different types of hazardous pollutants.

Acid gases, for example, irritate the skin, eyes and breathing passages, it said, and dioxins are probable carcinogens that also cause reproductive problems, among other things.