NV Energy postpones plans for coal plant in Nevada

LOS ANGELES Mon Feb 9, 2009 8:58pm GMT

LOS ANGELES (Reuters) - NV Energy has postponed plans to build the 1,500-megawatt Ely Energy Center in Nevada due to environmental pressures and estimates that capturing coal-fired carbon emissions will not be feasible before 2020, company president and ceo Michael Yackira said.

In a telephone interview, Yackira said that even if the Ely Energy Center is postponed to 2020 or so, it does not mean that the plant has been canceled.

"We believe that it would be economically imprudent for our customers and our investors to go forward at this stage," Yackira said. "We believe coal is an important resource for this country. We have more coal than any other resource (for electricity generation)."

However, until so-called clean coal technologies that can capture carbon work and are affordable for utilities, NV Energy won't build coal plants, he said.

But Ely has not been canceled, Yackira said.

"When we say postpone, we say the message is correct," he said.

In the past few years, the number of coal-fired power plants planned have dropped from about 200 to about 70, and more are being canceled or postponed every week.

So-called clean coal plants are seen as key to keeping domestic coal king of U.S. power generation. About half the power generated in the United States comes from burning coal, more than twice the power made at natural gas or nuclear plants.

Yackira declined to say whether he thought other utilities with plans for coal-fired power plants will follow NV Energy's lead and call off construction until clean coal is an affordable reality.

NV Energy three years ago said the Ely Energy Center's two 750-MW units and associated transmission power lines would cost about $3.8 billion and be operational by 2012. That price tag has jumped to more than $5 billion, Yackira said, with opening of the plants in phases in 2015 and 2016.

NV Energy still plans to build the transmission line that was to carry power from Ely in northeastern Nevada to populous southern Nevada that includes Las Vegas.

But now, instead of coal-fired power, it will carry renewable power created by wind turbines and geothermal fields, Yackira said.

The original plan for the north-south transmission line was about $600 million, but the line that will carry renewable power will cost a fraction of that. The company has not yet made any details public, Yackira said, noting those plans must first be announced to Nevada utility regulators.

NV Energy is the holding company for Nevada Power Co and Sierra Pacific Power Co. It serves about 1.2 million power customers.

(Editing by Jim Marshall)

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