Troubled Days: Healy Clean Coal Project Stalled.

• Author: JONES, PATRICIA
• Position: Statistical Data Included

Despite great difficulties, Golden Valley Electric Association and the Alaska Industrial Development and Export Authority are working on changes to make the Healy Clean Coal Project a reality.

After six years of development and nearly $300 million of state and federal spending on an experimental design, the Healy Clean Coal Project should be generating 50 megawatts of electricity for daily consumption throughout Interior Alaska.

But in spite of such spending and extensive technological review, the experimental coal-fired power plant sits idle at its location just outside the Parks Highway community of Healy.

It has not operated since January 2000, when Fairbanks-based Golden Valley Electric Association terminated a power-purchasing agreement with the plant's developer, the Alaska Industrial Development and Export Authority.

Then, and now, GVEA claims that technology incorporated in the design of the experimental coal plant at Healy-while capable of producing electricity-does not work on a reliable, cost-effective basis. Therefore, the Fairbanks utility terminated its agreement with AIDEA, in which GVEA would operate the plant while paying AIDEA for the electricity generated under terms of a power-sales agreement.

"Itran, and it showed some promise, but there's not another order for it," said Mike Kelly, former president of GVEA, about the "clean coal" technology at Healy. "They demonstrated that they could make it work, but they could not prove it on a commercial basis."

He believes that the experimental, clean, coal-burning equipment should be replaced with more conventional technology-a process that's already been proven after a conversion of GVEA's existing 34-year-old coal power plant located adjacent to the Healy Clean Coal Project.

The cost for that conversion is estimated to range anywhere from $50 million to $85 million, expenses additional to the $292 million already spent to build the Healy Clean Coal Project. AIDEA and GVEA are working together to try to find a federal source for the retrofit expense, most likely in the form of a low-interest loan.

"We've been somewhat encouraged," said Bob Poe, executive director of AIDEA, following a mid-August meeting with representatives from Alaska's congressional delegation.

How much, if any, additional federal funds can be allocated to the Healy project remains unknown.

"There's $117 million of federal money in that and currently we have a plant that is not operating," said Michael Menge, a staffer in Sen. Frank Murkowski's office in Washington, D.C. "The solution is not so evident Our job is to try to figure out exactly what the problem is and to help...