Cox intervenes on behalf of Wolverine coal plant

The Missaukee Circuit Court has granted Attorney General Mike Cox permission to intervene in a lawsuit filed by Wolverine Power Cooperative which claims that the state did not have the authority to deny an air permit for a coal plant planned for Rogers City.

Wolverine and Cox are asking the court to reverse the Dept. of Natural Resources and Environment’s denial of the permit and declare Governor Granholm’s executive order on coal unconstitutional.

In May, after more than two years of hearings and deliberations, the DNRE denied Wolverine a permit for the 600 megawatt coal plant on the grounds that it had not demonstrated a need for the facility.

The agency also noted that building the plant would result in a 60 percent rate hike for Wolverine customers.

The DNRE’s action followed a Michigan Public Service Commission analysis of the project which found that the cooperative had failed to adequately consider other ways of meeting power needs.

The MPSC wrote: “Other alternatives that may fill all or portions of the projected capacity need include: energy efficiency and load management; renewable resources; or a combination of a number of alternatives that could include lesser amounts of purchased power.”

The commission’s report was initiated by Gov. Jennifer Granholm’s February 2009 executive order which invoked a provision of the federal Clean Air Act that allows states to conduct analysis work on whether projects are “feasible and prudent.”

In his motion to join the case, Cox, who leaves office at the end of the year, wrote that as the state’s top law enforcement officer he “has a duty to ensure that the State’s laws are respected and followed by all entities, including State departments or public agencies.” He said he sought to join in the case in order to protect the public interest.

Cox says no state or federal law empowers the MDNRE to deny a permit based on need and that determination of need is a utility management issue over which the MPSC has no authority.

The decision on whether to build a plant should be made by management on behalf of shareholders who share economic risk, he argues.

“Whether the power is or will be needed in the utility’s service territory may not be what is driving the utility’s decision to construct additional generating capacity,” Cox states, because “… the power produced by a utility can now be sold to others outside its service territory.”

Though he acknowledges that the federal Clean Air Act requires state regulators to consider alternatives to a proposed new source of pollution, “the no build option is no ‘alternative’ at all,” Cox argues.

Wolverine and Cox also argue that Granholm’s order on coal violates the state constitution by attempting to change state environmental law.

The AG‘s office represents the MDNRE in this case, and now that Cox has joined Wolverine as a plaintiff his office is arguing both sides of the case.

“Appropriate actions have been taken within the Department, including the establishment of an isolation wall between the various attorneys on September 15, 2010, to ensure vigorous and unfettered advocacy on behalf of the Attorney General and the DNRE,” Cox wrote in a footnote to his brief.

The AG’s office did not return a call seeking information.

Shannon Fisk represents the Natural Resources Defense Council which, together with the Great Lakes Environmental Law Center, has joined the case in support of MDNRE’s permit denial.

“We are disappointed that Cox would intervene against the agency he is supposed to be representing,” Fisk said. “We think the agency was correct and MDNRE has the authority to reject the 9,000 tons of air pollution that Wolverine would emit in light of the fact that the plant is not needed.”

The environmental groups point out:

“The Plant would cost nearly $2 billion to install, and every year would emit 2,647 tons of nitrogen oxides, 1,344 tons of sulfur dioxide, 4,002 tons of carbon monoxide, 725 tons of particulate matter, 171.7 tons of volatile organic compounds, 80 tons of sulfuric acid mist, 700 pounds of lead, and 42 pounds of mercury…

Air quality modeling done by Wolverine and reviewed by MDNRE showed that, depending on the pollutant and the time period of measurement, the Proposed Coal Plant’s emissions would use up between 12 and 57% of the available air quality in the Rogers City area for each pollutant.

“Need is evaluated in the context of what other alternatives are out there,” Fisk said. “Given that there are other options that are better, there isn’t a need for the coal plant. We believe that the law is clear and that [Gov. Granholm's executive order] was simply confirming what the law requires.”