Saddled with debt, UNC unsure it can go coal-free soon | Orange County | Indy Week

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Saddled with debt, UNC unsure it can go coal-free soon

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The Sierra Club's Coal-Free UNC campaign has asked how a campus many consider to be a regional leader on environmental issues can still burn thousands of tons of coal each year.

UNC's Energy Task Force, a group established in January to address that, and other questions, got its answer last week.

The university owes $94 million in debt on its cogeneration plant and must continue to burn coal and charge consumers for its use to pay for the facility by 2022.

The campus must pay the same debt on the plant's equipment—as well as employee salaries—regardless of how much energy the facility produces. Increased energy efficiency or renewable energy sources, such as solar and wind, which can be costly, decrease customer demand for coal-based steam. In other words, revenue from alternate energy sources can't pay off the debt on time.

"You could say it's a double whammy," said Carolyn Elfland, associate vice chancellor for campus services. "We have been able to continue to spread those fixed costs across a broader base, because we're growing," Elfland said. "But if we stopped growing, yes, the costs would rise every time we saved."

Or as Task Force Chairman Tim Toben put it, "So, you're really disincented to be efficient today."

"Yeah, you could look at it that way," Elfland acknowledged.

The revelation comes as UNC faculty members and the Town of Carrboro have joined students, environmentalists and neighbors in publicly calling for UNC to stop using coal by 2015.

UNC is re-examining its pledge to go carbon neutral by 2050 by searching for technology and fuel sources that could accelerate the pace of its carbon reduction.

Ray DuBose, UNC's energy services director, said after last week's task force meeting that the campus isn't focused on defending coal; it's been examining alternatives for two years.

When the consultants convened in 2008, the group analyzed 15 alternative energy strategies and agreed on four long-term options to pursue, each of which is structured to accommodate the needs of the cogeneration plant.

Two scenarios would repurpose the plant's existing boilers after 2022: One would require UNC to burn a 100 percent coal substitute, and another prescribes a 50-50 mix of natural gas and coal substitute.

There are two other options: plasma gasification, which uses electric current to shred solid waste into elements and then into energy; and large-scale biomass, which would shut down the plant, but not until at least 2030, the end of its useful life. Both of these options would require building separate facilities.

In the near term, possibly by 2025, consultants suggested replacing 20 percent of campus coal with torrefied wood, chips that are roasted to become more brittle and easier to burn. They plan to test dried wood pellets and torrefied wood in the next two years in the hopes of burning woody biomass at the cogeneration plant in 2012.

After detailing the shortcomings of current energy-efficiency measures, Elfland turned to Dennis Hazel, an N.C. Cooperative Extension forestry specialist.

"That's why [Hazel] needs to help us switch to biomass, so we can use the plant we owe the debt on, and then we'll be in great shape," Elfland said.

But Hazel, despite looking to 17 million acres of forest as a massive potential renewable-energy incubator, told the task force that though woody biomass would be a cleaner source than coal, no company in the state produces it on the scale UNC would require.

"We just heard that wood may be a good substitute, but we don't have a source," Toben said after the meeting. "It's a challenge. There's not a simple solution."

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