by Bernie Woodall

LOS ANGELES - Opponents of coal-fired power plants say they were given a new weapon last week when Kansas became the first state to reject a coal-fired power plant solely on the basis of the health risks created by carbon dioxide emissions. [1]

A dozen states have rejected plans for 22 new coal-fired power projects in the past year-and-a-half, mainly because of concerns over carbon dioxide (CO2) emissions. Kansas does not regulate carbon emissions and is believed to be the first state to tie CO2 to health risks and use that as the only stated reason for denying a required air permit, said Bruce Nilles of the Sierra Club.

Growing public awareness of climate change and the unknown cost of mitigating CO2 if and when a national carbon cap-and-trade system is established have forced regulators and utilities to rethink a planned boom for coal plants.

"Today, the political climate has changed. There is a lot more activism and with all the uncertainties around carbon regulation, we're seeing a real slowdown in the building of coal plants," said Bill Durbin, head of global gas and power research at consultant Wood Mackenzie.

Coal's dominant role as a fuel for 50 percent of U.S. electric production is much less certain than just a year ago, said Durbin.

"If you had asked me that question a year ago, I would have said of course not because we need more coal-fired power plants to meet the growing energy needs," Durbin said.

Joe Lucas, executive director of the coal lobby Americans for Balanced Energy Choices (ABEC), said the U.S. needs for energy will prevail over "short-sighted" opposition to coal power.

"If coal's on the run, then a lot of Americans need to get prepared to sit around in the dark," Lucas said.

In his decision, Kansas health and environment secretary Roderick Brembyin cited an April U.S. Supreme Court ruling, which found that CO2 was an air pollutant under the Clean Air Act.

The Kansas action and Supreme Court decision will be used as precedents in future fights with King Coal, Nilles said.

Coal-burning power plants make more than 85 percent of the greenhouse gas emissions that cause global warming. Coal-fired power plants are the leading emitters of CO2.

Lucas said the long-reaching impact of the Kansas decision may be diminished because Bremby went against his own staff's recommendation. Even with the Supreme Court decision, new coal-fired projects can prevail in lawsuits expected after many state-level decisions, he said.

The developer of the rejected Kansas plant is planning an appeal, as are some Kansas lawmakers.

When the Sierra Club intensified its fight against coal power in 2003 and 2004, it looked like 2007 would be a major year for coal power construction. Those plants have been pushed back to 2011 and 2012, said Nilles.

By that time, Nilles confidently predicts, a national CO2 regulation scheme should be in place, helping make coal-fired power plants cost-prohibitive.

"Our assessment is the window to build these things is closing rapidly. The coal industry knows that. They want to get their permits and get steel in the ground before Congress acts," said Nilles.

The states where projects have been shelved are Texas, Florida, North Carolina, Delaware, Kentucky, Illinois, Oklahoma, Iowa, North Dakota, Idaho and Arizona, according to a list compiled by the Kansas governor's office, using a federal government study.

For additional analysis on carbon markets and climate change policy, please join the online Reuters carbon community at http://www.reutersinteractive.com/carbon [2].
© 2007 Reuters