POWER December 2015 - 44

GENERATION TRANSITIONS
Seminole Electric Cooperative
Sees Big Challenges from Clean
Power Plan
Florida's Seminole Electric Cooperative faces what may be the most difficult
generation transition in the nation as a result of the Obama administration's
Clean Power Plan. One of the nation's largest generation and transmission
rural electric cooperatives, Seminole owes its origins and its
current position primarily to a single coal-fired plant.
Kennedy Maize
W
hen electric utility veteran Lisa D.
Johnson took control of Florida's
Seminole Electric Cooperative in
mid-2013 as CEO and general manager (see
sidebar), she quickly faced a daunting task.
As she assumed management of the large
generation and transmission (G&T) cooperative
based in Tampa, Johnson inherited a
system built largely on coal.
Soon after she took the job, a major part of
her management task became guiding the cooperative's
response to the upcoming Environmental
Protection Agency (EPA) regulations
aimed at reducing carbon dioxide emissions
from existing coal-fired power plants.
An Existential Challenge?
It could be an existential challenge for Seminole.
In an August interview, a Tampa Bay
Times reporter asked Johnson, " Could costs
get so high that the cooperative would be
forced to disband or be sold? " She answered,
" It's too soon to know if that is an option or
one that we would pursue. " But it is a potential
outcome for the cooperative.
In congressional testimony this spring,
Johnson told the House Energy and Commerce
Committee, " Seminole, in particular,
would suffer substantial harm as a result of
EPA's proposal, a reality that EPA has failed
to, but must, address. " The final EPA rule, issued
this fall, doesn't provide Johnson with
much additional clarity about how it will
affect her organization, although the overall
thrust remains negative.
" We're still sorting through the details, "
she said in a POWER interview in October.
" It's a little bit early " to make definitive conclusions,
she said. " We are certainly looking
toward the state and whatever the state of
Florida plans to do in terms of issuing a [state
implementation plan] or not. "
So far, she said, Seminole has not heard
44
from the state about what course it will
choose to take under the EPA plan, which
relies on the strictures of the 1990 Clean Air
Act amendments. The Clean Air Act puts
states in control of implementing federal air
policy. That may not be the best way to meet
the Obama administration's goal of combatting
the threat of global warming, because the
problem far transcends state borders. But it
appears to be the only policy tool available to
the administration, given the failure of Congress
to enact new air legislation. Johnson
said she is confident Florida " will let folks
know " when it has figured out the direction
the state government wants to take.
If Florida refuses to offer a state implementation
plan, a course some Republican
opponents of the Obama plan are advocating,
then the EPA would impose a " federal
implementation plan " on the state. Florida's
Republican governor, Rick Scott, hasn't
made his views known on whether the state
will submit an implementation plan or face
off with the EPA.
A major problem facing both Seminole
and the state is not knowing whether the
EPA plan will actually go into effect, might
be overturned by the courts, or might be
scrapped when a new administration comes
to Washington in 2017. Given the uncertainties,
Seminole, said Johnson, is " going to
have to put some significant effort toward
planning and decision-making. It does create
a question of how much of that effort could
be put aside if there are changes to the rule. "
But Seminole must begin planning for the future,
while keeping its options open.
Coal-Heavy by Federal Mandate
Seminole, one of the nation's largest G&T
cooperatives, serves 1.4 million retail utility
customers through nine distribution co-ops in
42 Florida counties. Its heart and soul is foswww.powermag.com
sil
energy generation-mostly coal, followed
by natural gas-and 350 miles of transmission
lines to deliver its power to the retail
distribution co-ops.
Seminole's ties to coal are tight. In 1948,
several Florida rural electric distribution cooperatives
incorporated Seminole to allow
them to aggregate their demand and seek
lower-cost electric power as a G&T cooperative
sometime in the future. Seminole
was a paper organization until the 1973 Arab
oil crisis. That earth-shaking development
prompted the board of the virtual organization
to get physical. The distribution cooperatives
that run the G&T decided to turn it
into a real G&T utility, selling power it generated
at cost to member retail cooperatives
and wheeling power at cost.
The G&T utility initially looked at oilfired
generation. That was a dead end. Congress
forestalled oil generation with the 1978
Power Plant and Industrial Fuel Use Act,
which banned new oil- or gas-fired electric
generating plants. That left coal as the only
item on the menu.
Johnson said she feels that Seminole is a
victim of contradictory federal energy policy
over many years. She said, " Seminole decided
to build a coal-fired plant because it did not
have another viable option. " Given the provisions
of the 1978 law, Seminole had no way to
meet its growing load other than coal.
With a " prevention of significant deterioration "
air permit from the EPA in 1979,
Seminole began building two 650-MW coalfired
units in Palatka, in northeast Florida on
the St. Johns River. The plant went into service
in 1984. Over three decades of service,
according to the co-op, the Seminole Generating
Station (SGS) has had an average capacity
factor of 80%, making it " the primary
work-horse in Seminole's system " (Figure
2). It is, Johnson said, " a relatively new plant,
POWER | December 2015
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POWER December 2015

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