The Center for Rural Affairs released the following statement in response to news that Sheldon Station, the coal-fired power plant north of Hallam, Nebraska is undergoing a major transition from coal to an exciting and innovative power generation technology. Nebraska Public Power District (NPPD), which owns and operates the plant, plans to replace an existing coal-fired boiler at its Sheldon Station plant with one that uses hydrogen fuel. The hydrogen will be produced by Monolith Materials as a co-product from its production of carbon black using natural gas as a feedstock. Plans for the second of two boilers were not made clear.

“We applaud the Nebraska Public Power District’s staff and board of directors for taking steps to invest in a power source that can benefit the local community, while reducing the amount of harmful toxins released into the environment,” said Johnathan Hladik with the Center for Rural Affairs. “This is leadership Nebraska has been waiting for. However, today’s announcement marks only the halfway point. It’s a ‘job half-done.’ We expect NPPD to carry this momentum forward and continue this commitment to rural economic development by investing in the vast resources we have here in Nebraska for energy production, create well-paying jobs for skilled workers, and protect our most vulnerable populations – children and the elderly – from a range of health issues exacerbated by harmful pollutants released by burning coal.”

Research by the Center for Rural Affairs and Synapse Energy Economics shows that continuing to operate Sheldon Station as it has been in the past would have incurred cumulative economic losses of over $1.3 billion by 2042. These are costs that would have been shifted to NPPD’s ratepayer-owners. Continuing to burn coal at both Unit 1 and Unit 2 at Sheldon Station would also have prevented NPPD from investing in the very alternatives, like renewable energy and energy efficiency, that have the potential to produce considerable economic benefits in rural Nebraska.

Center for Rural Affairs findings also show that, Sheldon Station, too old to produce more than 60 percent of the 225 megawatts of energy it was once capable of, is past-due for a transition. The power plant has quickly become a financial liability to NPPD and its ratepayers, becoming operationally uneconomical after 2020.

“Continuing to burn coal at Unit 1 and Unit 2 of Sheldon Station would have required costly updates to protect Nebraskans from exposure to harmful toxins and comply with new environmental regulations,” added Hladik.

The Center’s research predicted that NPPD ratepayers and those in the Lincoln Electric System, which contracts with NPPD for one-third of Sheldon Station’s capacity, would have picked up the tab for hundreds of million of dollars in retrofit capital costs that would be necessary for Sheldon to comply with significant, new environmental requirements.

“NPPD’s announcement at Sheldon Station today begins to reflect the values of many rural Nebraskans, who believe that we have a special responsibility to be good stewards of our natural world: to use only what we need, make smarter choices and pass on to our children the wildlife, water and natural resources we have here in Nebraska,” Hladik continued. “We encourage NPPD to adhere to these principles and seek out public involvement as future decisions are made.”

We are encouraged by the changes that NPPD has announced, and urge continued investments in renewable energy and energy efficiency that benefit rural and small town Nebraskans, and keep electricity affordable, concluded Hladik. Nebraska ranks 7th among the states for energy consumption per capita, and consistently ranks in the bottom third among states for its efforts to use energy more efficiently. Serious investment in energy efficiency will go a long way in keeping NPPD ratepayer-owners’ bills affordable.