State says proposed electric plant isn't subject to strict approval steps

December 03, 1992|By Ross Hetrick | Ross Hetrick,Staff Writer

The Maryland Public Service Commission has ruled that a proposed electric power plant near Cumberland is exempt from a rigorous approval process that could have delayed the construction of the controversial plant.

The 180-megawatt coal-fired plant, called Warrior Run, has become a center of contention because the utility that will buy the plant's power, Potomac Edison Co., said it would have to raise electric rates by 10 percent to 20 percent to pay for power that it no longer needs.

Potomac Edison, which provides electricity to Western Maryland, contracted with AES Corp. of Arlington, Va., to build the plant in 1988. The agreement was approved by the PSC in January 1989. The plant, which was to begin generating power in 1995, would supply electricity to Potomac Edison and steam to surrounding companies.

But since the approval in 1989,Potomac Edison said the need for the plant has disappeared as growth in demand has slackened because of conservation. If Potomac Edison was not bound by the contract with AES, it would not build such a large generating facility until after 2000, according to Cindy Shoop, a spokeswoman for Potomac Edison. Instead, she said, the company would build smaller "peaking" generators to supply electricity only in periods of high demand.

In an effort to have the proposed power plant reviewed -- and postponed, if warranted -- the Potomac Chapter of the Sierra Club in Frostburg asked the PSC in August to subject the Warrior Run plant to the approval process for a certificate of public convenience and necessity.

Such hearings have been routinely required when utility companies have proposed building power plants. But it was not until July that the PSC decided that independent power producers that contract with utility companies also had to be subjected to this approval process.

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