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Hurdles face UAF bid to find power source

Tim Bradner

The University of Alaska Fairbanks coal-fired power plant is almost half a century old and badly needs to be replaced soon.

It's going to be a big-ticket item, though. Preliminary cost estimates are in the $200 million range, according to Bob Shefchik, UAF's executive officer.

Permits are of major concern, too, given the Sierra Club's national campaign to shut down coal-fired power plants. The restart of the Healy Clean Coal Project, a 50-megwatt coal new-technology plant at Healy that could cut Interior Alaska electric bills by 20 percent, has been bogged down in permit issues mainly due to opposition by the Sierra Club and other groups.

Shefchik hopes the UAF power plant replacement will navigate the regulatory system without opposition from environmental groups. UAF has already engaged local conservation groups on the plant, he said, but has yet to talk with the Sierra Club.

The new plant will be a replacement rather than a new coal plant, Shefchik said, and the newer-technology coal-burning systems to be put in place will generate less pollution than the existing plant.

"That's turn-of-the-century technology," he said.

The reference is to 1900, not 2000.

The blunt fact is the university needs more power, and soon. The existing coal-fired plant has an 8-megawatt capacity and given the growth of buildings on the campus the UAF is short 1 to 2 megawatts, Shefchik said. The gap has to made up by using diesel, which can be done by the plant but it is expensive.

Because the aging coal plant can't meet the campus power demand the university has to buy 1.2 million gallons of fuel oil yearly to generate additional power and also buy electricity from Golden Valley Electric Assoc., the regional utility.

The replacement plant would have a 17- to 20-megawatt capacity.

Because the plant and its systems are aging there are also more breakdowns, maintenance and spot outages. Reliability is critical in Fairbanks, where winter temperatures can drop to minus-60 degrees F.

As for fuel, coal is the only alternative that is practical. The wind doesn't blow much in Fairbanks, particularly in winter, so wind is out. It's dark in winter in the Interior, so that takes out solar.

All-electric would be wonderful if the proposed Watana dam is built on the Susitna River, but that's uncertain, and Watana wouldn't be in operation until 2022 or later. Plus, the price of power would have to be 5 cents a kilowatt hour to beat coal, which is unlikely.

Oil is really off the table, cost-wise. Coal costs the university $4 per million British Thermal Units. Oil costs $30 for the same amount of energy. "If we fueled with oil our annual fuel bill for the campus would rise from $8 million to $34 million a year, Shefchik said.

Natural gas is a good option if there were gas, but none is yet available in the Interior that is affordable for UAF. If and when gas could come from the North Slope is unknown, and natural gas that is now trucked from Anchorage as liquefied natural gas, or LNG, is typically priced just under heating oil in cost per unit of energy.

However, the advantage of natural gas, Shefchik said, is that gas turbines cost less than coal turbines and is cleaner and therefore easier to permit. A gas-fired plant might be half the cost of a coal-fired plant, Shefchik said. But there's a risk:

"No one knows when gas will be available, or what it will cost," he said.

Biomass is an intriguing possibility, but the scale of what's needed for UAF is beyond the ability of Interior forests to provide on a practial basis. What can be done is to design the replacement coal plant boilers to be able to burn biomass as well as coal, Shefchik said. This is being done. The plant will be designed so that as much as 20 percent of its fuel could be biomass, which could include municipal waste, Shefchik said.

Tim Bradner can be reached at (c)2012 the Alaska Journal of Commerce (Anchorage, Alaska). Visit the Alaska Journal of Commerce at Distributed by MCT Information Services.

Alaska Journal of Commerce