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Tuesday, July 23, 2019

Arkansas high court will examine power plant approval process

By Michelle Massey, East Texas Bureau | Feb 12, 2010

Arkansas Supreme Court

TEXARKANA, Ark. -- The Arkansas Supreme Court will hear oral arguments on April 15 about the process used to approve the certificate that granted SWEPCO's construction of the John W. Turk Power Plant located in southern Arkansas.

The high court will decide if the Arkansas Public Service Commissions' process for considering permits is flawed.

The state Supreme Court granted SWEPCO's appeal of the Arkansas Court of Appeal's 2009 decision that revoked the permit for the $1.6 billion coal-fired power plant.

In June 2009, with an unanimous decision, the appellate court overturned the commission's approval of the plant. Rejecting the Certificate of Need permit that allowed the construction, the court said state regulators did not adequately review plans and said the approval process was flawed.

The Certificate of Need is the legal authorization granting a regulated utility to construct a power plant or transmission facility and recover the costs from Arkansas consumers through rate increases. The permit is only issued after a formal and public review by the state and by stakeholders.

SWEPCO's application for the permit was approved in November 2007, with an amended permit granted in December 2007. Construction on the plant did not begin until November 2008, after the Arkansas Department of Environmental Quality issued an air permit that will regulate the plant's emission sources.

Hempstead County Hunting Club, Schultz Family Management Co., Po-Boy Land Co. Inc. and Yellow Creek Corp. challenged the approval of the certificate to the Arkansas Court of Appeals. The petitioners argued that the Public Service Commission failed to comply with the requirements to issue a Certificate of Environmental Compatibility and Public Need. The appeals court agreed, specifically finding that the petitioners' strongest argument centered on the process of approval.

According to the court's opinion, the commission failed to uphold Arkansas statutes to resolve all matters in a single forum that has exclusive and final jurisdiction. The process that is contested involved three separate meetings, with the first meeting not being announced to all potential interested stakeholders as defined by Arkansas codes.

"Piecemeal consideration of all the matters concerning a generating plant and its transmission lines corrupts the spirit and letter of the law," the opinion stated.

The judges wrote that the commission needs to consider whether its decision to approve the plant was arbitrary. The court believes that the commission failed to comply with a law that requires utilities to demonstrate environmental impact and public need.

In a concurring opinion, Appeals Court Judge Josephine Linker Hart, wrote that the commission is required "to balance the growing need for electric and gas utility services, which may require construction of new major utility facilities, against the protection of the environment, the quality of life of the people of this state, and the development of alternative renewable and nonrenewable energy technologies."

After the permit was revoked, SWEPCO asked the Arkansas Supreme Court to take up the case instead of reapplying for the permit.

During any appeals, by law, the permit issued remains in effect. Several opponents, including the Sierra Club and Audubon Arkansas, petitioned the Pollution Control and Ecology Commission to halt the construction of the plant during the appeal process but the request was denied on Jan. 22.

SWEPCO representatives state if construction were halted, 920 constructions workers would be out of a job and another 440 potential employees would not be hired.

Environmentalists, including the Sierra Club and the Hempstead County Hunting Club, are continuing to oppose the plant's continued construction, arguing that the coal fired power plant will spew toxins and contaminate the environment and surrounding ecosystem. The opponents also argue that the plant will violate the federal Clean Air Act.

The attorney for the petitioners, Richard Mays, states that the decision to grant the permit should be based on environmental factors and not on any potential economic impact in the area.

Opponent Audubon Arkansas states that the SWEPCO's decision on the location of the facility, in the "pristine Little River Bottoms," was a "huge miscalculation."

SWEPCO plans for the plant to use "ultra-supercritical advanced coal combustion technology that will use less coal and produce fewer emissions, including carbon dioxide, than traditional pulverized coal plants."

SWEPCO's president and CEO Paul Chodak states, "This is an important case – both for the Turk Plant and for the process used to approve major utility projects in Arkansas for more than 30 years. We believe the record in the case will show that the approval process was correct and the Turk Plant approval should stand."

As of Sept. 30, SWEPCO has spent $830 million on the construction of the plant.

If the higher court upholds the appeals court's ruling, the plant will be forced to start the permit process over.

Oral arguments will be held in front of the Arkansas Supreme Court April 15 at 9 a.m. in Little Rock.

Case No: CA 08-128

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