Power play in the East Bay over greenhouse gases

Despite being rebuffed for four years by courts and regulators, an East Bay community college continues to spend public funds fighting an already-under-construction natural gas power plant in Hayward that is the first in the country with a greenhouse gas emissions cap.

The 600-megawatt Russell City Energy Center, which began seeking operating permits in 2001, is located on 19 acres near Hayward’s water treatment facility.  

Russell City’s majority owner, Calpine, says the $1 billion facility uses both reclaimed water and technology that makes it cleaner than 90 percent of comparable older power plants.
“We build a lot of power plants. We’re considered one of the cleanest companies in the United States because we only do gas and geothermal,” said Joe Ronan, Calpine’s senior vice president for government and regulatory affairs.

“We couldn’t build a plant there – or anywhere – if there’s any harm or danger to the health and welfare of the people around it.”

Although several groups initially opposed the siting of the plant for various reasons – mostly concerns over possible health risks from emissions – only Chabot Las Positas Community College District remains.

“The (carbon dioxide) emissions from this proposed plant would be equivalent to adding 331,877 vehicles from a single-source polluter right next to a campus of 15,000 students,” said Joel Kinnamon, the college’s chancellor in an April 2010 press release announcing Chabot’s appeal of the issuance of an operating permit for Russell City.

Laura Weaver, the district’s director of public relations and governmental affairs, did not reply to two requests for comment until shortly before deadline, saying she would not have any information on the status of the district’s case until several hours later.

Weaver said she knew nothing about the district’s appeal beyond what is posted on the district’s website – information that’s nearly one year old.

Jewel Hargleroad, the district’s lawyer, also did not respond to a request seeking information on the status of the legal proceedings.   

Court records show the district has had an appeal pending at the federal Ninth Circuit Court of Appeal since December 2010.

“I’m baffled by why they continue to fight this thing or at least put so much money into this,” said Wil Hardee of the Alameda County Taxpayers Association in a March 2010 interview.

At the time of the interview, the association counted $118,000 in legal fees paid by the district. That number has since increased to more than $220,000, according to the association.

“When you have critical budget issues like those we’re facing in California, using your own money is one thing but using public money gets our attention,” said Hardee who, in 2010, was president and CEO of the Oakland African American Chamber of Commerce.

In a March 9 letter, Kinnamon said the district was facing a predicted $10.3 million shortfall because of state budget cuts.

At its meeting the previous day, Chabot’s Board of Trustees eliminated 26 positions, eight of which were vacant, Kinnamon said in the letter.

Of the 18 lay-offs, five were management and 13 were rank-and-file employees.

Kinnamon notes that staff cuts and previous cost-cutting measures “endanger our ability to serve our students.”

Chabot first challenged the construction of Russell City in 2007, three weeks after Calpine received a go-ahead for the project from the Bay Area Air Quality Management District.

That permit came after six years of hearings and petitions before the California Energy Commission and the Bay Area air district.

In 2002, the energy commission issued a 301-page decision approving the plant’s license, noting it presented “no significant adverse environmental impacts.”

Calpine notes that no appeals or protests were filed over the commission’s decision.

To blunt opposition by the Sierra Club and EarthJustice, the company capped its carbon dioxide emissions at 800 lbs per megawatt hour of power generated.

That cap is 300 lbs less than the maximum the state Public Utilities Commission imposes on investor-owned utilities like Pacific Gas & Electric, which is buying Russell City’s power.

The move earned the company national publicity – and praise from some environmental groups – for proposing the first power plant with a limit on greenhouse gas emissions.

To woo local support for the project, Calpine donated $10 million to the Hayward public library system. The company, which operates 38 power plants in California including geothermal The Geysers in Sonoma County, also agreed to Hayward’s request to move the plant’s site.

The East Bay Regional Park District was the beneficiary of 26 acres and $1.5 million over five years to help maintain its trails.

Both Calpine and the Hayward City Council tout the plant’s economic benefit.

Among them are creation of an estimated 650 union construction jobs, a one-time sales tax boost of $30 million and $4 million annually in higher property tax revenue.

The bulk of the plant’s $3.5 million estimated operating budget will be spent locally, Calpine says.

But Chabot has shown no interest in financial support from Calpine.

Nor does it yet believe the impact of the plant’s emissions is benign.

Normally, to navigate through the regulatory requirements of siting a power plant takes roughly five years, Ronan says.

One reason Russell City took longer is confusion between it and a second proposed Hayward power plant called Eastshore.

A “peaker” plant – one that operates when energy need is greatest – Eastshore would have had higher emissions than Russell City. It also would have been located closer to Chabot.
Local opposition mounted to the plant, which would have been the second in the area.

Prompted by that outcry, Assemblywoman Mary Hayashi, D-Hayward, introduced legislation to require approval by local city councils and supervisors before the state could issue a license to power plants.

The state energy commission denied Eastshore a permit in October 2008. But some area residents viewed Russell City in a similar light.

Indeed, one of Chabot’s initial legal filings against Russell City identified it as Eastshore.

Hayashi says she has no position on Russell City.

“She’s not opposed. She’s not in favor. She’s not involved with Russell City,” said Ross Warren, Hayashi’s chief consultant.

Since the district’s initial filing in 2007, the state energy commission has declined to reconsider its decision to give Calpine a license.

A petition by the district and others asking the California Supreme Court to overturn the energy commission’s ruling was denied.

And, in February 2010, the Bay Area air district issued a final “Prevention of Significant Deterioration” permit – the necessary OK to break ground on Russell City.

Five parties, including the district, appealed the decision to the US Environment Protection Agency’s Environmental Appeals Board.

Nearly eight months later in November, the appeals board issued a 136-page opinion saying the arguments raised by all parties – including Chabot – did not merit yanking the permit.
Groundbreaking on Russell City occurred that month.

On December 17, 2010, the district
’s petition for reconsideration of the appeals board ruling and a request for a stay to block Russell City construction was denied by the EPA.

Three days later, the district filed a petition with the Ninth Circuit asking it to review the EPA’s decision.

To date: No hearing has been set. No briefs filed.