'Dirtiest' power plant to finally get scrubbers

Friday, July 20, 2007
By TOM JOHNSON
NEWHOUSE NEWS SERVICE

PSEG Power said yesterday it will spend up to $750 million to install pollution controls at its coal-fired plant in Jersey City, a project that would avert the shutdown of the 608-megawatt plant by the end of 2008.

The plant, long viewed by environmentalists as one of the dirtiest power plants in the state, was ordered by state and federal environmental agencies in 2002 to install more sophisticated pollution controls, but the company, a subsidiary of Public Service Enterprise Group, held off on the investment because of changing energy market conditions.

The original decree, issued by the state Department of Environmental Protection and federal Environmental Protection Agency, directed the company to reduce pollution from the plant, which contributes to smog and acid rain, as well as mercury emissions.

Under a revised consent decree reached last December, the company agreed to notify state and federal environmental officials by the end of this year whether it would move forward with the project. If not, the plant, considered important to maintaining the reliability of the power grid, would have to close by the end of next year.

The decision to move ahead with the project, expected to be completed by 2010, got a mixed reaction from environmental groups.

"New Jerseyans have waited far too long for PSEG to install these pollution controls. As a result there have been real risks to public health," said Suzanne Leta Liou, global warming advocate for Environment New Jersey.

Liou said the new pollution controls will help curb smog and other pollution, but will contribute greenhouse gas emissions likely to make it more difficult for the state to achieve ambitious targets for reducing carbon dioxide pollution.

In deciding to move ahead with the costly project, William Levis, president and chief operating officer of PSEG Power, said the energy landscape is much different today than it was in 2002, when the original consent decree was put in place.

"Projects which looked questionable at best five years ago now make sense. This was a clear sign that PJM's new rules for capacity under the reliability pricing model are working. Companies can make disciplined investment to ensure system reliability and protect the environment," he said.

PJM, the operator of the regional power grid, earlier this year enacted a new pricing system aimed at keeping older power plants in service by increasing the amount of money they receive for having excess capacity to meet power demands at peak periods.