New coal power plant goes online near Gillette

A new coal-fired power station went online in northeastern Wyoming on Thursday, marking the state's first coal plant completion since early 2008.

WyGen III will deliver electricity to about 70,000 residents in western South Dakota and parts of Wyoming and Montana. It was built by Black Hills Power Corp. for $247 million to meet growing electricity demand in the region.

To cover the 100-megawatt plant's price tag, the bill for a typical residential customer in Wyoming is expected to rise by about 64 cents a day. That's more than $230 annually.

In South Dakota, rates would rise by about 59 cents a day, or $216 annually.

Final rate approvals are pending before state regulators. Rate changes in Montana remain undetermined.

WyGen III has been running on a test basis since mid-February with no major problems, said Black Hills Vice President Mark Lux said.

"The project was completed in 24 months ahead of schedule and under budget," he said.

The plant is one of six coal-fired power stations at the company's WyoDak Energy Complex north of Gillette. Combined, the plants produce about 600 megawatts of electricity.

When Black Hills was planning WyGen III in 2007, wind power and natural gas were considered as alternatives. Lux said coal came in as the lowest-cost option.

There are no immediate plans to capture the greenhouse gases emitted by WyGen III, although Lux said there is room to retrofit the plant for carbon capture technology if needed in the future.

Environmental groups criticized the project, saying it would emit an estimated 2.5 million tons of carbon dioxide annually. But they never filed a formal challenge of its air pollution permit.

Wyoming produces more coal than any other state - about 40 percent of annual consumption in the United States - and has at least four other plant proposals still in the works.

Another in the Gillette area, Basin Electric Power Cooperative's 385-megawatt Dry Fork Station, cleared a major hurdle in early March. That's when the Wyoming Supreme Court upheld the project's air quality permit.

The permit had been challenged by two environmental groups, the Powder River Basin Resource Council and the Sierra Club.

The Sierra Club also has challenged Dry Fork in U.S. District Court in Cheyenne.