POPI shuts down

The controversial cogeneration plant in south Oroville that burns biofuel to produce electricity is shutting down operations by the end of October. The Pacific Oroville Power Inc. plant, aka POPI, is owned by New Jersey-based Covanta Energy; it has been under scrutiny by the Butte County District Attorney’s Office for the past three years for possible environmental violations.

When it was first fired up in 1983, POPI burned wood chips generated by timber harvests. As the local lumber industry declined, the plant added agricultural waste to help meet the 28 tons of fuel the incinerators consumed per hour to produce enough energy to power 20,000 homes. That electricity was sold to Pacific Gas and Electric.

Covanta spokesman James Regan said running the plant is no longer economically feasible.

“Unfortunately, power rates are not sufficient to cover the cost of operations and fuel,” he said from his New Jersey office. “This does happen with some regularity in the biomass industry when power prices are not sufficient to cover costs. Obviously you can’t burn in the red. It’s a decision we have to make based on economics.”

Covanta-owned cogeneration plants in Westwood and Burney have also closed. Regan said the POPI facility will shut down when its remaining fuel supply is used up, which should happen by the end of October.

Covanta will continue to own the plant, he said, which could be restarted in the future “with some changes.”

“We will continue to evaluate the future of the facility as we move forward,” he said.

In the meantime, the closure will put about 20 people out of work. Those workers have been notified and offered post-employment benefits, as is company policy, Regan said.

Last year PG&E applied to the state Energy Commission to amend its agreement with POPI in a way that would provide the plant “with a higher price for delivered energy in exchange for stricter performance obligations and other beneficial terms and conditions,” according to the proposal.

That proposal also said: “In 2010, POPI indicated that it had become uneconomic to operate the Facility under the [existing agreement’s] terms and conditions.”

Regan said with the exiting contract, shutting down operations comes at Covanta’s discretion.

In recent years POPI began burning “urban waste,” the remains of torn-down buildings that can contain metals, asbestos and other less-than-eco-friendly materials. The DA’s Office caught wind of this new practice and tested the resulting on-site ash for toxicity.

Earlier this year, a 19,000-ton pile of ash from the facility was located off of Hicks Lane in north Chico and subsequently tested. The ash, which has since been moved to a landfill in Wheatland, was high in dioxins. Ash was also piled in the Glenn County community of Artois and then plowed into agricultural land as a soil amendment, including a corn field whose crop is used as cattle feed.

POPI-generated ash is also believed to have been used as a soil amendment in fields in Durham and Oroville.

Paul Moreno, the regional spokesman for PG&E, said he was not aware of the pending closure but would try to have someone familiar with it contact the News & Review for comment. That call had not been made by press time.

David Lusk, senior air-quality engineer for the Butte County Air Quality Management District, which oversees POPI, said the cogeneration plant’s operating permit amounts to about $12,000 a year. The company, he said, has asked to maintain its permits, which allow for “non-attainment emissions,” in anticipation of future operations.

Lusk and Regan both said they had concerns about a recent stories in this paper about the ash piles and the reported use of used carbon filter, which the DA’s Office said was coal, as a fuel.

Regan said tests of the ash pile in Chico did not reveal high levels of toxins. Both men said the plant was not burning coal. The DA’s Office, which conducted the tests, said dioxin levels exceeded the limits established by the World Health Organization and that the carbon filter was 95 percent bituminous coal and 5 percent coconut shell.

Lusk also said that “combusting agricultural wastes such as orchard removals, prunings, etc., in a facility such as POPI is beneficial for air quality because the combustion and air-pollution controls on the plant produce much less pollution than the open burning of these materials.”