New hurdle for cross-border power projects


Efforts by energy companies to build power plants in northern Mexico so they can export electricity to the United States suddenly became more complicated this month, due to a ruling by a federal judge in San Diego.

Judge Irma Gonzalez held May 6 that the U.S. Department of Energy and U.S. Bureau of Land Management acted illegally in determining that a pair of Mexicali power plants would not significantly harm the border region’s air and water quality.

The two natural-gas-fired plants, built by InterGen and Sempra Energy, are among more than a dozen such facilities slated for northern Mexico on account of Mexico’s lower construction costs, lighter regulation and the region’s proximity to the U.S. market.

InterGen and Sempra’s plants are largely complete and were scheduled to begin sending electricity to California during the upcoming northern-hemisphere summer. But Judge Gonzalez’s ruling puts a crimp in those plans.

Environmentalists said the decision should serve as a warning to the administration of U.S. President George Bush, which is trying to speed power-plant construction.

“The ruling sends the message that the Bush Administration cannot allow U.S. energy companies to avoid U.S. environmental laws by moving their power plants a few miles south of the border,” says Marcello Mollo of Earthjustice, one of three nongovernmental groups whose lawsuit prompted the ruling.

Participants in the power projects argue that their combined-cycle plants, which are being outfitted with selective catalytic reduction pollution-control systems, are efficient and clean. Says Sempra Spokesman Art Larson: “We are confident the environmental effects of the plant will pass any further review or study.”

Illegal permit?

At issue is the Bush Administration’s December 2001 approval of a presidential permit allowing InterGen and Sempra to build transmission lines leading from their Mexicali plants into the United States.

InterGen, a joint venture of Bechtel and Royal Dutch-Shell, says it will use 560 of the 1,060 megawatts of installed capacity at its La Rosita plant to produce U.S.-bound electricity and devote the rest to power generation for northwest Mexico. Sempra, meanwhile, says all the electricity created by its 600-megawatt Termoeléctrica de Mexicali plant will be exported to California.

The U.S. move prompted a lawsuit from the Border Power Plant Working Group, a joint, U.S.-Mexican nongovernmental organization, and two U.S. green groups—Earthjustice and Wild Earth Advocates. Though the suit addressed the transmission lines, Judge Gonzalez determined that since the lines are an integral part of the plants, she could consider the projects’ overall environmental effects. She took issue with the Bush Administration’s “finding of no significant impact” (Fonsi) on both air- and water-quality grounds.

Concerning air quality, she held that while federal officials adequately addressed nitrogen oxide and particulate emissions, they did not pay proper attention to carbon dioxide and ammonia output. She also faulted the government for neglecting to consider cumulative impacts in the Imperial County-Mexicali air basin, where communities already exceed their respective national air-quality standards.

Regarding water quality, Gonzalez questioned the administration’s endorsement of InterGen and Sempra’s plans to discharge the treated wastewater they want to use to cool their plants into the New River, which flows across the border to California’s Salton Sea. Siding with the plaintiffs, she concluded the government had given short shrift to concerns that the discharges would contribute to the Salton Sea’s ongoing increase in salinity.

Next round: remedies

The question of what remedies will be required will be determined in proceedings set to begin with the submission of court papers by June 9. A hearing is slated for June 16.

Plaintiffs argue the two energy companies ought to implement so-called offset projects that reduce air pollution in the Imperial County-Mexicali air basin by an amount equivalent to the contamination caused by the new power plants. They also want InterGen and Sempra to outfit the plants with cooling systems that rely on air rather than water to moderate turbine temperatures.

Plaintiffs’ attorney Julia Olson says that in the remedy phase, her side will call for both of these mitigation steps and also seek an injunction blocking the use of the transmission lines until the U.S. government prepares an environmental-impact statement. Bill Powers, chair of the Border Power Plant Working Group, says he hopes the energy companies will negotiate.

“Our objective is the environmental impacts must be mitigated,” he says. “We’d much rather do that than drag it on while an environmental-impact statement is completed. We’re now in a position to push for that in a much more serious way. We still want those plants to be a model for others being built along the border.”

- Diane Lindquist

Andrew Como
Deputy Director
Electrical Power Generation
U.S. Department of Energy
United States
Tel: (631) 344-7014
Fax: (631) 344-7616
Darcel Hulse
Sempra Energy International
San Diego, CA, United States
Tel: (619) 696-2034, (877) 736-7725
Marcello Mollo
Oakland, CA, United States
Tel: (510) 550-6700
Julia Olson
Wild Earth Advocates
Oakland, CA, United States
Tel: (541) 344-7066, (415) 786-4825
Bill Powers
Chief Engineer
E-Tech International
San Diego, CA, United States
Tel: (619) 295-2072
Fax: (619) 295-2073
Andrew Smith
U.S. Department of Justice
Albuquerque, NM, United States
Tel: (505) 344-7066