by Carey Gillam

OVERLAND PARK, Kansas - If there is one lesson Kansas officials have learned by rejecting a proposed expansion of a coal-fired power plant last month, it is this: Hell hath no fury like business interests scorned.

Six weeks ago Kansas Secretary of Health and Environment Rod Bremby made Kansas the first U.S. state to reject a coal-fired power plant solely because of health risks associated with carbon dioxide emissions. Since then, the state has become ground zero for a nationwide battle pitting environmental concerns against powerful economic and political interests.

Kansas is now facing lawsuits from Sunflower Electric Power Corp and industry groups while angry state lawmakers are determined to overturn the denial of the $3.6 billion power plant project, with some even threatening to dismantle the state department of health and environment.

The energy industry also is pouring money into the state to try to overturn the October 18 ruling, which killed Sunflower's plan to add two 700-megawatt units to its operations in western Kansas, a cash-strapped rural area.

"Everybody agrees that motherhood, apple pie and caring about the environment are fantastic," said Bob Kreutzer, head of the newly formed Kansans for Affordable Energy. "But we've got to make sure we always have electricity and that is why we need big power plants."

Coal-fired power plants make roughly half the electricity generated in the United States, according to the U.S. Energy Information Administration. But in the past 18 months, about a dozen states including Texas, Florida and Oklahoma also have rejected plans for 22 new coal-fired power plants.

Unlike Kansas' health and emissions concerns, those states cited mainly technical reasons for the rejections as officials increasingly acknowledge growing public concerns about climate change.

Environment groups seized on the Kansas decision as a potent precedent they hope will influence more states to reject new coal-fired power plants, whose emissions globally are among the biggest man-made sources of greenhouse gases.

SUNFLOWER GOES TO COURT

Business groups and a Republican-led contingent of state legislators are working to nullify the decision, saying the Sunflower project would create jobs, provide badly needed energy for the area, and keep electricity rates in check.

Sunflower filed lawsuits on November 16 in both state and county courts seeking to overturn the decision. Sunflower's supporters, which include business, political and industry leaders, say neither the federal Environmental Protection Agency nor state statutes consider CO2 a pollutant. They also say neither the state, Bremby nor the governor has the authority under state law to limit an unregulated emission.

Similar lawsuits were filed by at least two business groups and a Colorado wholesale electricity supplier.

The debate also has played out in television and newspapers ads around the state -- with one series claiming leaders in Iran, Russia, and elsewhere will benefit from the ruling because the state will have to import more natural gas. Opposing ads rejected the claims as unfounded.

Sen. Sam Brownback, a Republican who dropped out of the race for president in October, has weighed in, calling the Kansas decision part of a "partisan political agenda."

Others echoed the charge, saying Kansas Gov. Kathleen Sebelius, a Democrat, is using the climate change issue to angle for higher political office.

Sebelius has defended the decision and said instead of building the new coal-fired facilities, which would produce 11 million tons of carbon dioxide a year, she supports alternative sources, such as wind energy.

"Carbon has a huge impact on the atmosphere and global warming is very real," Sebelius said in an "open letter to Kansans."

Regardless of what happens in Kansas, the tide is shifting away from traditional coal-based power despite the fact coal is cheap and plentiful, said Dietrich Earnhart, director of the Center for Environmental Policy at the University of Kansas.

"People are concerned about global warming," Earnhart said.

"At the state and regional level leaders are feeling if the federal government is not going to do something then they will do something," Earnhart said. "There is a reason that Al Gore won a Nobel Prize."

(Editing by Bill Trott)
© Reuters 2007