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Project Information
Highwood Generating Station
Southern Montana Electric Generation & Transmission Cooperative
was formed out of the common wholesale power need of the
member systems. Five electric cooperatives and the newly-formed
municipal utility system, Electric City Power, for the City
of Great Falls, joined forces to bring reliable and competitively-priced
long-term wholesale power supply to its users. During the
evaluation of alternatives for power suppliers to replace
wholesale power supply contracts that will expire near the
end of this decade, it was determined that the best course
of action was to construct a coal-fired power generating
plant.
Stanley Consultants, an engineering firm with years of experience
in the coal-fired generation field, was engaged to conduct
a siting study to determine the best location for the proposed
power plant. On their recommendation, Southern Montana Electric
G&T has tentatively selected a site for the plant outside
Great Falls, MT. The power plant will be called the Highwood
Generating Station.
Discussions related to the long term financing of the project
with the U.S. Department of Agriculture, Rural Utilities
Service (RUS) are ongoing and additional requirements for
the Environmental Impact Statement (EIS) are being addressed
by Mangi Environmental Group. A team of consultants lead
by the firms of Stanley Consultants, Inc. and Bison Engineers,
Inc. will provide the information necessary to complete the
EIS from the preliminary design and permitting processes
to Mangi for incorporation into the EIS document.
Interim financing for the development of Highwood Generating
Station will be provided by CoBank with long-term financing
provided by RUS.
Power Supply Options Review
Over the past 60 years, the member systems of Southern Montana
Electric Generation and Transmission Cooperative (Southern
Montana Electric G&T) have met their total wholesale
power supply requirements through use of traditional power
purchase agreements. Prior to June 2000, the member systems’ supply
needs were met through a combination of purchased power from
the former Montana Power Company (MPC) and the Western Area
Power Administration (Western). The member systems had a
defined “allocation” from Western that satisfied
approximately 20% of the need, with MPC meeting the remaining
requirements under terms and conditions of an “all
supplemental power requirements” contract that expired
on June 22, 2000.
Since expiration of the contract with MPC, power has been
purchased from the Bonneville Power Administration (BPA).
Power provided by BPA is a combination of power produced
at hydroelectric facilities located along the Columbia River,
and a small block of environmentally-preferred product or
wind generation. Unfortunately, the BPA purchase opportunity
that provided Southern Montana Electric G&T an energy
portfolio that was primarily hydroelectric generation, will
begin to expire in 2008, and disappear completely in 2011.
In the wake of the “Energy Policy Act” passed
by Congress in 1992, and the “Electric Utility Industry
Restructuring and Customer Choice Act,” passed by the
Montana Legislature in 1997, MPC began divesting itself of
its generation assets. Pennsylvania Power and Light purchased
those assets in 1999, removing wholesale power transactions
involving energy produced by these assets from the regulatory
process. Today, all wholesale power transactions in Montana
are consummated at “market rates,” with the exception
of those purchases made from power marketing agencies not
regulated by the Federal Energy Regulatory Commission (FERC),
such as BPA and Western.
Montana power users, at both the retail and wholesale level,
no longer have access to electric energy at a regulated rate.
With the exception of limited purchases from BPA and Western,
electric energy prices in Montana are “market based.”
The member cooperatives made several attempts to engage
in meaningful discussions with owners of existing generation
to secure an affordable replacement for the BPA contract.
The most recent effort to secure a power purchase agreement
was conducted in November 2003. This process led to the conclusion
that continuing to rely solely on traditional power supply
agreements was not acting in the best interest of the member
systems. At that point, the list of options for providing
power was broadened to include the concept of constructing
a base-load electric generating facility.
Market volatility, transmission capacity issues, and the
unwillingness of owners of existing generation to sell the
output of their facilities at prices lower than “what
the market will bear,” offered compelling reasons for
the cooperatives to seek a supply option that provides a
higher level of control over existing and future supply needs.
In response to a need for affordable, reliable, and quality
wholesale electric energy and related transmission services,
Beartooth Electric (Red Lodge), Fergus Electric (Lewistown),
Mid Yellowstone Electric (Hysham), Tongue River Electric
(Ashland), Yellowstone Valley Electric (Huntley), and the
City of Great Falls joined forces and formed Southern Montana
Electric G&T. These providers of public power and related
services have embarked on a course of action to ensure that
their members/consumers – approximately 120,000 Montanans – will
have a locally-owned and controlled supply of electric energy.
Over the course of the past several years, the region’s
economy has been disadvantaged by energy supply and price
uncertainty, demonstrating that a key component of sustained
economic activity is access to appropriately-priced electric
energy and related services. Affordable energy is essential
for agricultural, commercial, and municipal activity. In
order for these Montana entities to function productively,
their energy supply future must be secure.
Southern Montana Electric G&T believes it is time for
Montanans to step up to the plate and secure a supply of
responsibly developed electric energy. Recent irreversible
legislative activity, corporate divestiture of cost-of-service-based
resources, and modified service goals for federal power marketing
agencies make this an urgent need. Access to cost-based electric
energy is an essential attribute of our ability to ensure
a sustainable quality lifestyle. Southern Montana Electric
G&T is convinced that this goal can be achieved while
serving as wise stewards of Montana’s resources. Affordable
electric energy and related services are fundamental needs
shared by all Montanans.
To meet the energy needs of the member systems it serves,
Southern Montana Electric G&T has taken a proactive role
in developing a sustainable energy supply portfolio. This
required taking an unbiased look at all available options – purchases
from existing resources; renewable resource development;
and the construction of a new, environmentally-sensitive
energy production facility. Southern Montana Electric G&T
has taken a bold step toward the development of a well-balanced
energy supply that will ultimately embrace a responsible
variety of supply alternatives including traditional base-load
facilities and proven, cost-effective renewable resources.
Project Background
Southern Montana Electric G&T will work with the U.S.
Department of Agriculture Rural Utility Services (RUS) for
any project financial needs. At the suggestion of RUS and
the Cooperative Finance Corporation (CFC), Southern Montana
Electric G&T contacted East Kentucky Power Cooperative
(EKPC). EKPC hosted a tour of E.A. Gilbert Unit 3, then under
construction, for Southern Montana Electric G&T staff.
The unit is located at the Spurlock Generating Station near
Maysville, Kentucky. EKPC offered assistance in plant design,
construction, training, and operation. During the tour, Southern
Montana Electric G&T was introduced to Stanley Consultants,
who provided detailed design, procurement support, resident
engineering services, and construction management support
for the EKPC project.
[The E. A. Gilbert project was declared commercial in March
of 2005. To view a timetable of the E.A.
Gilbert Project at Spurlock Station (Click Here).]
Several studies were initiated and completed to satisfy
requirements for project justification. Southern Montana
Electric G&T contracted with Stanley Consultants to provide
engineering support for the studies. A detailed load forecast,
an alternative energy evaluation, a site screening, and a
site selection study were included, and provided to RUS for
evaluation and approval. These studies are located on the
[RUS]
website.
These studies also formed the basis for the environmental
impact study (EIS). The EIS is funded by Southern Montana
Electric G&T, and administered by RUS, and will evaluate
the environmental impact of the proposed project. This study
will also satisfy the State of Montana’s requirements
for a state EIS. Mangi Environmental Group is performing
the EIS. Stanley Consultants is providing preliminary engineering
information, and Bison Engineers is providing environmental
information from permit applications to Mangi. Electrical
Consultants, Inc., has also supplied preliminary information
on transmission lines to Mangi. The Montana Department of
Environmental Quality (MDEQ) will work in cooperation to
prepare a joint EIS document. Once completed, and upon a
favorable decision, Southern Montana Electric G&T will
begin construction at the site when other permits are obtained.
[To view the latest information related to the EIS at the RUS website
or at the MDEQ website.]
Project Overview
General
The Highwood Generating Station (HGS) will be a 250 MW coal-fired
circulating fluidized bed (CFB) boiler power plant, and will
be similar to E.A. Gilbert Unit 3, completed last year for
EKPC. CFB boiler technology was developed in cooperation
with the U.S. Department of Energy to reduce emissions from
coal-fired electric generating facilities.
An Integrated Emissions Control Strategy (IECS) utilizing
Montana low-sulfur coal, and Montana limestone, with additional
control technology, will capture more than 95% of sulfur
dioxide (SO2) emissions and more than 90% of nitrous oxide
(NOx) emissions. A minimum capture rate for mercury emissions
of 80% or an emissions limit of 2.0 pounds per trillion BTUs
will be achieved. Southern Montana Electric G&T will
test utilizing Activated Carbon Injection or an equivalent
technology to determine the facility’s ability to achieve
a mercury capture rate of 90%, or an emissions limit of 1.5
pounds per trillion BTUs.
Steam generated in the CFB boiler will be utilized in a
steam turbine to produce 250 MW of electrical energy. Steam
conditions at the turbine will be 2,400 pounds per square
inch (psi) in pressure, and 1,000 degrees Fahrenheit (?F)
in temperature. The turbine rotor will spin at 3,600 revolutions
per minute (rpm), and will weigh approximately 75 tons. Montana
coal will be consumed at the rate of 150 tons per hour, and
Montana limestone will be consumed at a rate of 106 tons
per day. Two train loads of coal, each consisting of 100
bottom-dump coal cars, will be required each week. Southern
Montana Electric G&T has committed to addressing non-regulated
greenhouse gases such as carbon dioxide (CO2).
HGS is a “first step” in developing a diversified
energy resource portfolio that may be expanded to include
proven renewable resources, such as wind and geothermal,
to meet future load requirements.
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