Generation and transmission co-ops need
to spend $27.8 billion over a decade.
— National Rural Electric Cooperative Association survey
After a co-op starts the building process,
“Changes in environmental regulations can increase
costs when they require additional emission standards.
Some states like Wisconsin and Minnesota are
discussing imposing mercury controls, for example,”
said Ross Wasson, NRECA’s director of tax finance
and accounting policy. Experts say that carbon control
is also a likely standard in the near future.
Because of the financing and environmental rules,
developing a new power plant becomes a lengthy,
cumbersome process. NRECA’s Holt estimated that
meeting environmental standards can often take two
years and construction of the plant itself takes three to
four years. Any co-op developing a new power plant in
2006 can expect to see it open circa 2012.
Like many other co-ops, East Kentucky Power
Cooperative had not built a new power plant since
1982. It obtained $430 million in financing from the RUS
and built the Gilbert Generating Unit, a 268-megawatt
coal-fired power plant in Maysville, Ky., in 2005. “We’ve
been growing at a rate twice the national average
because of the growth of our member cooperatives,”
noted Kevin Osbourn, manager of communications
at the co-op. In 2008, the cooperative will be also
supplying wholesale power to Warren Rural Electric
Cooperative in Bowling Green, Ky., which serves about
56,000 customers, and will be joining its co-op.
While other co-ops have faced lengthy delays in
obtaining environmental approvals, East Kentucky
gained its air-quality permit from state and federal
agencies in 15 months.
Asked why East Kentucky was able to gain
acceptance and complete the plant’s construction in
30 months, a quick turnaround, Roy Palk, CEO of East
Kentucky Power Cooperative, said the co-op had a set
strategy in place and employed environmentally sound
technology, which helped gain fast approval from RUS.
Furthermore, East Kentucky has selected an existing
site and had already gained permits to use that site.
In fact, East Kentucky has already gained approval for
another new power plant, the Spurlock Unit, costing
$470 million. Construction began in June 2006 and is
scheduled for completion in June 2009.
While rural G&T co-ops are nonprofits and don’t
compete with other utilities, they operate in an energy
marketplace. Co-op power plant construction is increas-
ing, Palk said, because, “We need to be competitive
with other utilities in the region. We have to be competi-
tive with the cost of money, technology and labor.”
Dealing with Terrorism
The Role of the National Emergency
Response and Rescue Center
By Ken Silverstein
The threat of terrorism is pervasive, particularly in light of
turbulent world events. Emergency response plans are thus becoming
the norm. And utilities have a vital role to play. Not only do they provide
essential services but they are also in a position to assess just how
vulnerable communities are and any effects of a horrific act.
Every utility in America has taken steps not only to safeguard the
security of its facilities but also to develop robust systems that can
continue to generate and deliver power if attacked. Preventing arbi-
trary acts is still an obstacle, and probably more of a police or military
concern. But the erection of barriers has long been under way, as
have emergency practice drills. These are the safeguards that experts
say will keep the country’s power flowing in times of crisis.
“We try to get the public works and utilities sectors up to speed on
potential threats and potential target sites,” says Vince Slominski, an
instructor with the Texas Engineering Extension Service and National
Emergency Response and Rescue Center. “We want to get them back
in operations and to get the community back to a state of normalcy.”
The center, which helps local governments and their staffs respond
to terrorists’ threats, says that utilities have assets and manpower
that are vital in the effort to assist other first responders with evacua-
tions, search-and-rescue operations and damage assessments. The
process, says Slominski, has been laid out by the Office of Homeland
Security. It’s one that begins at the local level, with state and federal
resources added as needed.
Law enforcement typically takes the lead role and determines who
does what. Fire departments, emergency management services and
public works often take a proactive part in such cases. Once a unified
command center is established, essential personnel directs operations in
the field that include helping the wounded and performing searches. Other
groups, meantime, are responsible for organizing supplies or participating
in long-range planning that involves trying to mitigate future damages.
www.energycentral.com  EnergyBiz magazine  13
 Energy Business

assets as well as characterize potential risks

. Planning and training. Power Investor based on historical accounts.
for Bangladesh Once a threat level is determined,
.go hand in hand. . IDB Infrastructure companies should consider barricading
Fund has picked
up a 24 percent
those assets with gates and limiting
stake in Globeleq’s access to them by using smart cards
If a transformer or substation goes down, for example, interest in two that can identify each person coming
power projects near
the time it takes to replace broken parts can be expensive. Dhaka, Bangladesh.
and going. Meanwhile, cameras and
That’s why Slominski says that such equipment ought to Globeleq, with sophisticated alarms should pervade utility
be stockpiled in advance while pre-established contacts offices in Houston, campuses. In case of high alerts, or when
owns three
should be current and abundant. generating units in
a terrorist threat or criminal activity is
“It is our suggestion that you practice these events well in the Asian country. imminent, the management within a facility
advance,” says Slominski. “Come up with a scenario and apply Emerging Markets must be notified as well as law enforce-
it to your community to see how it would operate. The day of Partnership, in ment and medical teams. At the same
Bahrain, is IDBIF
the event it is too late. Planning and training go hand in hand.” general partner and
time, all personnel should be accounted
He points to Oklahoma City, which suffered the bombing manager. Mumtaz for and any outsider should be prohibited
of one of its federal buildings in the middle 1990s. Prior to Khan, the CEO of EMP from entering the campus for any reason.
Bahrain, said “the
that event, such essential enterprises as police, fire, medical IDBIF is delighted
Employees who have been trained to
units, utilities and public works had advanced training. They to be making this deal with disaster-related events should
handled one of the most dramatic and stressful events in first investment be able to respond properly to such things
in Bangladesh and
this country’s history with valor. And out of that came a more looks forward to
as power outages and cyber invasions. If
sophisticated emergency response team. future opportunities disaster should strike, utilities must have
to invest in “mutual assistance agreements” lined up
the country’s
Threat Levels infrastructure.”
to assist with the perpetuation of business.
The discussion is not theoretical. The specific steps that Under any circumstance, employees who
individual utilities are taking are highly secretive, mainly because they would are to operate critical assets must undergo background
not want any intruder to breach their own security. But according to papers checks — whether they are new employees or are being
filed by the critical-infrastructure working group of the North American promoted. The standard also requires a periodic back-
Electric Reliability Council, each company should prioritize its facilities and ground check at least every five years if an employee
continues to have access to the critical systems.
“If people with weapons want to bring harm to
*RIVK]
the population, there is not much a private company
'YWMRIWW
11 ~ 13 | Seventh Annual World
LNG Summit can do,” says Larry Brown, a member of the
To view any of these events, please go to Rome E14023 infrastructure group. “In this country, however, the
www.energycentral.com/quicklink and type the
redundancy rate we have built into our electrical
quick link code ( ) into the quick link box. 16 ~ 18 | Global Power Summit systems would make the results of an incident like
Pebble Beach, Calif. E13037 that far less severe,” adds Brown, who is also a
October lawyer for the Edison Electric Institute.
18 ~ 20 | 2006 Electric Market Power companies generally have systems in place
3 ~ 6 | EMACS 2006 Forecasting to fight the effects of natural disasters. Newark-based
Schaumberg, Ill. E13926 Tucson, Ariz. E14346 PSEG Corp., for example, has trained for and dealt with
its fair share of hurricanes, ice storms and floods. Its
4 ~ 5 | AWEA Wind Power November top priority is to restore power as quickly as possible
Finance & Investment
— something that can only be achieved through a
New York E14149 5 ~ 7 | T&D Summit
unified command structure that works hand in hand with
Santa Ana Pueblo, N.M. E14351
the local offices for emergency management, including
8 - 11 | EEI Fall 2006
Transmission, Distribution & 5 ~ 8 | APPA 2006 Customer firefighters and police, who have the communications
Metering Connections equipment to direct assets to where they are needed.
San Francisco E14316 San Antonio E13969 While most of their experience is derived from
dealing with acts of nature, utilities now have to learn
9 ~ 11 | 24th Annual Coal Market 6 ~ 8 | Utilities Field Service to deal with such unnatural disasters as terrorism.
Strategies 2006 They have accepted their assignment and prepara-
San Antonio E14406 Scottsdale, Ariz. E14543 tions are under way to modernize their emergency
response plans.

14  EnergyBiz magazine  September/October 2006

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www.energycentral.com  EnergyBiz magazine  15