Independent sales reps have their day in court

by Alyssa A. Lappen
Forbes | Sept. 16, 1985

Vol. 136, No. 17, p. 51
651 words

by Alyssa A. Lappen
Forbes | Jul. 29, 1985

Vol. 136, No. 14, pp. 78-79
1,221 words

Stand at Edison’s Bruce Mansfield power station on the Ohio River in southwestern Pennsylvania and you get a pretty good idea why the U.S. Coal card has been so hard to play.

Amid a deafening din, dirty smoke and gases from the 15,000 tons of coal the plant burns in its boilers daily are piped into 16 seven-story scrubbing towers spread over 250 acres in Shippingport, Pa. Water and quicklime roar in at the bottom. Nearly invisible hot air issues from the top, scrubbed clean of sulfur, soot and ash. Steel pipes lined with rubber take away 9 million gallons of sludge every day to a 1,300-acre man-made disposal lake 7 miles away.

When the first unit began operating in 1976, Mansfield represented the state of the art in coal scrubbing. It’s a showcase that attracts visitors from all over the world. The process takes 99% of the particulates out of coal smoke and 92% of the sulfur dioxide. But it is enormously costly and cumbersome. The scrubbers accounted for a third of he plant’s $1.4 billion construction cost. They consume half its $80 million annual operating budget (not including $250 million in coal costs) and 2.5% to 5% of its 2,360-megawatt power output. Each of the scrubbers has to be shut down every six weeks so workers can climb inside and remove clcium sulfate caked inside with high-pressure water jets. “Right now scrubbers are the only answer,” says Robert McWhorter, an Ohio Edison senior vice president. “But I hope we don’t have to do this again. It’s not a good technology.”

Coal-fired plants now account for 43% of installed capacity and generate 55.5% of the nation’s electricity. With the nuclear option all but dead (FORBES, Feb. 11), by the end of the century there could be a lot more of them. There are 86 coal units planned or being built, compared with just 38 nuclear units. Most of the new coal units–and all those using high-sulfur coal–will need scrubbers at least as effective as Mansfield’s. Under the Clean Air Act, coal-fired plants ordered after 1971 can emit no more than 1.2 pounds of sulfur dioxide for every million Btu of coal burned. Plants ordered after 1978 must remove 90% of the sulfur dioxide.

About 120 generating units are currently equipped with advanced scrubbers. Another 100 are planned or under construction. Over the next ten years or so, the utility industry will spend $95 billion on air pollution control, most of it for scrubbers. With scrubbers accounting for up to 40% of the construction cost of a new generating plant, new coal-fired units run about $1,000 to $1,200 per kilowatt to build, compared with $2,000 to $2,500 for nuclear plants.

Any alternatives in sight? Coal companies like Peabody Coal, Westmoreland Resources and Consolidation Coal are all funding research. The Electric Power Research Institute, a utility-funded outfit headquartered in Palo Alto, Calif., will spend $1.2 billion over the next five years working on cheaper and more effective ways of cleaning coal. Among them:

* Fluidized bed combustion, in which small chunks of coal are mixed with limestone and burned above a cushion of air at temperatures a half to a third lower than in conventional boilers. FBC techniques both cut emissions more effectively than conventional scrubbers and allow for modular construction, a significant advantage to an industry plagued by uncertain demand predictions and lead times of up to 12 years. All existing fluidized bed combustion plants are under 25 megawatts, or industrial scale, but three big utility-scale demonstration projects are on the boards (FORBES, July 15).

* Coal washing–cleaning the fuel before it burns rather than scrubbing the smoke and gases afterward. Roughly 500 coal-washing facilities of varying degrees of size and sophistication are now in place in the U.S. But only a small percentage of these are effective enough to meet the post-1978 requirements.
One of the best is in Homer City, Pa., where 16,000 tons of coal per day run through the Rochester & Pittsburgh Coal co.’s Iselin plant. First the raw coal is mixed with a slurry of magnetite and water and is pumped into cylindrical vessels called cyclones, where centrifugal force separates out the sulfur. After that the coal runs over concentrating tables, which further separate heavy particles from lighter coal.

Washing is far cheaper than scrubbing but not yet as effective–it cuts the sulfur content only by up to 70%. Still, it has many advantages, claims Clyde Sypult, Iselin’s plant manager. “Cutting coal’s abrasive content extends the life of the boilers,” says Sypult in a soft Appalachian drawl. “Washing also improves Btu content, increasing electric output, probably by 10%.”

* In coal gasification, one of the most promising technologies, a mixture of oxygen and coal slurry is heated to form gas, which is then cleaned and burned. Southern California Edison has already bought 375 million kilowatt-hours of power from Cool Water, a $269 million, 100-megawatt demonstration coal gasifier built in a California desert by an industry consortium. “Gasification has all the benefits of fluidized bed combustion and then some,” Dwain Spencer, an EPRI vice president, says enthusiastically. “Cool Water is the cleanest coal-fired plant operating today.”

Also expensive. After all, 100 megawatts at $269 million works out to a construction cost of $2,690 a kilowatt. And the price Southern California Edison pays for that electricity is made possible only by $120 million in price subsidies. But Cool Water, after all, is a demonstration plant. Spencer claims commercial plants can soon be built for $1,500 per kilowatt, cheap compared with the $5,192 spent at Long Island Lighting’s troubled Shoreham nuclear facility.

All these technologies have been around in primitive form for decades. Why were utilities not running flat out to bring them to the commercial stage long ago? Because clean coal technology became cost effective only in the 1970s, when oil prices shot up.

The coal industry claims it needs big money from the federal government–Uncle Sam has already spent nearly $2 billion on coal-related projects since 1981–and the long-term commitment big money would imply. Congress has authorized another $750 million. The industry wants that appropriated promptly. “The scope and urgency of this effort exceeds the capability of the private sector alone and will require an accelerated national effort,” R.E. Balzhiser, EPRI senior vice president, told a Senate subcommittee at hearings in May.

The U.S. needs 100,000 to 200,000 megawatts of new capacity, Balzhiser says, to meet expected demand growth of 2.2% to 2.7% annually over the next 15 years. New plant orders will be made in the next five years. And without federal funds, he argues, those promising technologies may not be fully developed in time.

Perhaps. But this is an industry notorious for overestimating demand–a major reason for its troubles in nuclear–and President Reagan and Energy Secretary John S. Herrington don’t agree that the government should pay the tab. The industry can and should finance clean-coal technologies itself, says Herrington. In fact, he $750 million in authorized but unappropriated funds does more harm than good, he says, by encouraging the industry to hold out for federal money rather than pushing ahead on its own. Will coal finally clean up its act?

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Environmental protection agency
by Alyssa A. Lappen
Forbes | Dec. 19, 1983

Vol. 132, No. 23, pp. 192-193
818 words


For all the talk about cleaning up toxic waste, something like 98% of it is still being dumped or buried. It should be simple enough to find a better solution and cash in on what ought to be a huge business opportunity. But in waste management, the solutions are as complex as the chemicals meant to be cleaned up.

The biggest impediment to a technological solution, many companies feel, is the U.S. Environmental Protection Agency. Its bureaucracy is so labyrinthine and the rules to administer the agency’s Superfund–a $770 million kitty designated specifically for toxic waste cleanups–are so entangled, that money for testing promising new technologies is rarely made available to outsiders, or even to those inside the agency.

That has hurt companies like Lopat Enterprises, Inc. This tiny Asbury Park, N.J. firm last year developed a product called K-20, which coats, and thereby renders harmless, polychlorinated biphenyls (PCBs), the deadly substance once used in all electrical transformers. Unlike incineration, which treats PCBs collected for disposal, K-20 can treat them in situ, so that buildings whose walls and ceilings were contaminated by PCBs during transformer fires no longer have to be closed down. Used commercially for the first time in October, K-20 reduced PCB contamination at a Pacific Gas & Electric site in California, from 60 parts per million to 0.1 parts per million in five days, according to Lopat President Louis Flax.

Sounds great. The problem is, many companies that might be inclined to try a new technique first want the EPA’s blessing before they get involved. In the case of K-20, the EPA has given no indication that it will get involved. The EPA says it has a solution for bulk PCBs: incineration. But the agency adds that it’s not in the business of approving, much less favoring, products that might clean contaminated buildings.

Does this mean that K-20 is a product with no market? Maybe yes, maybe no. No one inside or outside the EPA seems to know. “The whole thing is a bureaucratic merry-go-round,’ says Flax. “My brain is scrambled at this point.’

K-20 isn’t the only promising process languishing at the EPA’s door, says Joel Hirschhorn of the Congressional Office of Technology Assessment. “The EPA doesn’t have a formal program, if any, to deal with situations where innovative technology comes along,’ he says. “It is holding back their commercialization.’

If industry refuses to act without approval, should the EPA get into the testing business? The Reagan Administration thinks not, preferring to let the market work out its own problems. But where legal liability rears its ugly head, the market is often constrained. Nobody exposes himself to the risk of expensive litigation when there are cheaper solutions available. That is one reason most waste is still treated in the time-honored method: landfill.

Government has been around this block before. At the turn of the century, similar concerns led to the establishment of the Food & Drug Administration. While it performs almost no tests of new products and technologies on its own, the FDA reviews the experimental data that support those claims. The process has proved remarkably effective in delivering consistently high-quality medicines and pure food to the American public.

Then there is the National Bureau of Standards model. Their own laboratories test products and processes for other federal agencies, and set standards for performance in such areas as fire safety and use of hazardous materials in the work place. Either model should allow the EPA to perform an effective role in ensuring that the best technologies are made available.

Although the EPA has continued to duck any role in promoting technology, it may soon have no choice. A revised version of the Resource Conservation & Recovery Act of 1976 (RCRA) has passed in the House; Senate action will have to wait until next year. If it passes–the betting now is that it will–a twist of logic embedded in the legislation should force a greater use of technology: The bill pending gives companies that claim no alternative up to 54 months to come up with nondumping solutions for their most toxic wastes. If they don’t, the EPA must mandate a high-technology solution, irrespective of cost. Given EPA and industry laxity to date, it is almost certain that industry’s hand will be forced sometime in the late 1980s. Congress, apparently skeptical of the EPA’s willingness to get tough, chose to substitute time for action. A provision that would have forced the EPA to make companies use, within two years, the best available technology for their cleanups was written out of the bill. “After all,’ says Christopher Harris, counsel to the House commerce, transportation and tourism subcommittee, which helped shape the RCRA rewrite, “the last time the EPA tried to make rules in this area, it took them five years, and look where they got.’


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