This story initially ran in the September 2012 Energy Services Bulletin.
A coal mine that generates electricity and carbon offsets may sound like the energy equivalent of a unicorn, but an innovative project in Gunnison County, Colo., promises to provide both to Holy Cross Energy.
Specifically, the electricity will come from burning methane vented from the Elk Creek Mine. By preventing the release of the powerful greenhouse gas (GHG) into the atmosphere, the project will qualify for approximately 80,000 carbon offsets annually, and is registered for verification with Climate Action Reserve (CAR). The offsets will be initially registered with NYSE Blue.
Vessels Coal Gas is building what will eventually be a 3-megawatt (MW) power plant to capture the waste gas. Holy Cross is purchasing the entire output of the project, starting with the first 1-MW generator coming online this fall. “Otherwise, the methane is just escaping into the atmosphere from the active mine,” observed Special Project Engineer Chris Hildred, “and it would continue to for years after the mine closes. Turning it into electricity is a cleaner, safer alternative.”
According to the Environmental Protection Agency, coal mining activities worldwide emit about 986 billion cubic feet of methane into the atmosphere every year.
These emissions represent not only an environmental hazard—methane is more than 20 times more effective at trapping heat than carbon dioxide (CO2)—but an economic opportunity, as well. Vessels Coal Gas specializes in capturing this wasted resource, converting it to pipeline gas, heating or electricity. The bulk of captured methane goes into natural gas pipelines after gas treatment. However, according to the EPA database the Elk Creek Mine project will be the first small scale (less than 50 MW) power plant, and the second overall in our nation to collect methane from a still-active mine and turn it directly into electricity.
The gas will be dried and filtered for more efficient combustion, and burned in a reciprocating engine to generate electricity, which will be transmitted over a nearby 44-kilivolt (kV) line. “The gas preparation is a little different at the front end,” explained Tom Vessels, company president. “But otherwise, it’s the same process as capturing methane from a landfill, wastewater treatment plant or confined animal operation.”
The technology is good for any gas waste stream with a methane content of 20 percent or more, Vessels added. “There are facilities of this type all over Germany, and some are in operation in Australia and China. The United States has a significant potential power resource, if there was greater acceptance of the technology.”
Lining up the partners
Holy Cross’s challenge, as the power purchaser, was to arrange transmission from the mine. “The electricity had to be wheeled over medium-voltage distribution lines to a TriState [Generation and Transmission Association] substation, then across Western and Xcel Energy transmission lines,” said Hildred. “We weren’t sure in what order we needed to talk to people. DMEA [Delta Montrose Energy Association], the owner of the line that supplies power to the mine, had never dealt with anything like this before.”
All of the parties proved cooperative, so Holy Cross was able to sort out the distribution without encountering too many barriers. The utility signed the power purchase agreement and DMEA built a substation with a short extension to the 44-kV line.
Of course, no project happens without funding, and the developer was fortunate in finding an “angel” with an interest in alternative energy. Randy Udall, a sustainable energy advocate and former executive director of the Community Office for Resource Efficiency, happened to be at Vessels’s first meeting with Holy Cross Energy. “Afterward, Randy asked me if we were seeking partners and gave me the number of the sustainability director for Aspen Skiing Company,” Vessels recalled.
The innovative project appealed to the ski resort owner with its long history of supporting environmental causes, and the company put up the bulk of the funding to build the Elk Creek facility. “Aspen Skiing Company and Holy Cross Energy deserve accolades for seeing beyond the end of their noses,” declared Vessels.
The Elk Creek methane capture project is just one more of Holy Cross Energy’s forward-thinking strategies to manage its environmental footprint. The utility has an internal goal of limiting its carbon emissions growth to half its sales growth rate, and the plan does not ignore other GHGs.
Holy Cross Energy also has its own ambitious goal of getting 20 percent of its sales from renewable energy by 2015, and has already surpassed Colorado’s renewable energy requirement of 10 percent by 2020. The state does not count coalmine methane capture as renewable energy, but the project’s carbon credits are a proactive hedge against potential legislation that may eventually require all utilities to limit their emissions.
Holy Cross consumers actively participate in—and benefit from—their utility’s sustainability efforts. The co-op’s Wind Power Pioneers and Local Renewable Energy Pool programs have nearly 2,400 subscribers who purchase more than 1,562,000 kilowatt-hours of renewable energy each month. The WE CARE (With Efficiency, Conservation And Renewable Energy) program, launched in 2004, has resulted in 2,786 kW of net-metered and community-owned renewable energy generation capacity.
Holy Cross Member Services Manager Stephen Casey estimates that the WE CARE renewables program alone has prevented 3,886 tons of CO2 emissions (Assuming 1,500 kWh annually per kW of capacity, and 1.86 lb/kWh carbon intensity factor).
Calculating the emissions avoided through WE CARE’s conservation and efficiency measures is more difficult, but the programs’ popularity is not in question. Since its inception, WE CARE has distributed more than $4.53 million to its member-consumers in incentives and rebates. “Co-ops are about working with the community to find long-term solutions to problems like greenhouse gas emissions,” said Casey. “Thus far, our sustainability efforts have resonated favorably with many business and residential member-consumers of Holy Cross Energy.”