Austin Energy (the city-owned electric utility in the Texas capital) and Nacogdoches Power, LLC, are hosting a town hall meeting in Austin tonight about their proposed biomass-power partnership. They propose a $2.3 billion, 20-year contract for power from wood waste. Austin Energy would be the sole buyer of power from the plant for the duration of the 20-year contract. So Austin, always eager to lead the way in costly “green” ventures, is about to spend $2.3 billion on a 100-megawatt power plant that produces power from a fuel source that accounted for 0.95 percent of the total electricity generation in the U.S. in 2006. Not a surprising move, as the Austin Climate Protection Plan seeks to have 30 percent of the city’s power from renewable-energy sources by 2020. But even local environmental groups are urging caution:

“The City Council’s decision to delay a decision on the plant for a couple weeks is a good one because I think there are a lot of questions,” said Luke Metzger, director of Environment Texas, who said he supports getting power from a biomass plant but would like to see more data. “It’d be really helpful for that information to come out and be reviewed.”
Tom “Smitty” Smith, executive director of Public Citizen, a government watchdog and environmental group, said he likes the basic concept behind the project but still has concerns about the cost and environmental impact, specifically pollution and the amount of wood waste that might be available to fuel the plant.
Mike Sloan, president of local renewable energy consulting firm Virtus Energy, said Austin shouldn’t make such an expensive decision before Austin Energy’s planned effort this fall to gather input about future sources of energy. “There are so many changes going on in the energy industry right now; it would be a good idea for Austin to get its priorities based on input from the people,” Sloan said.

Austin Mayor Will Wynn is raring to go, though: “Wynn said partnering with Nacogdoches Power is a valuable opportunity. If Austin doesn’t jump on this offer, someone else will, he said. ‘I definitely want to act when we can control our destiny,’ Wynn said. ‘This is a remarkable hedge against the volatility of fossil fuels (pricing) and whichever carbon regime is going to happen sooner rather than later.’” Missing from Mayor Wynn’s comments are the effects of the project on Austin Energy ratepayers. Austin is preparing to commit $2.3 billion for 100 megawatts of generating capacity. The FutureGen project promised 275 megawatts of generating capacity for about $1.5 billion. The two proposed additional units at the South Texas Nuclear Project will generate 2,700 megawatts for about $6 billion. On a cost-per-megawatt basis, the city would be better off pursuing these zero-emissions alternatives rather than air-polluting burning of wood waste.

The kicker: Austin Energy owns 16 percent of the existing two STNP units but declined to participate in the two new units over cost concerns. Maybe Austin’s ambitious Climate Protection Plan had something to do with it. The article reports, “If the biomass plant and a planned solar power project for a city-owned Webberville tract go forward, 18 percent of Austin Energy’s fuel would be coming from renewable sources in 2012.”