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The California Energy Commission left hanging the fate of a 450 MW AES generation facility in Huntington Beach in a bitter dispute over how to mitigate the impact of its once-through seawater cooling system. At a September 14 commission hearing on the issue, AES said it ultimately would sue the commission if it adopts its staff's $7.9 million mitigation plan. "We are left with no other option but to pursue all the remedies we have," said Eric Pendergraft, general manager at the AES Huntington Beach plant. He called the plan unjustified. Commissioner Jeff Byron defended the plan, saying it was based on sound scientific principles that should not be compromised. However, faced with the prospect of a suit and the critically needed units shutting down in an area facing imminent blackouts, the commission balked and delayed a decision until September 27 in hopes of reaching a compromise. AES sells all the power from the two units to Southern California Edison. In urging the delay, commissioner Jim Boyd said he believed that it still might be possible "for both sides to come out of their caves and gather around the bonfire." At issue is how many acres of the Huntington Beach wetlands AES should have to pay to restore to mitigate the impacts of the cooling system for units 3 and 4 at the plant. A commission study shows that to offset the loss of marine life entrained in the cooling system, the generator must pay to restore 104 acres at a cost of $7.9 million. An AES study counters that the company needs to restore a maximum of 16.9 acres at a cost of $980,200. The CEC expedited a license to retool units 3 and 4 during the energy crisis in 2001, deferring the normal study of the marine impacts to bring new power quickly on line. Edison mothballed the two units when it sold the plant to AES in 1995. However, the commission ordered the study and mitigation of any cooling system impacts if the two units keep operating after September 30 through the end of their 10- year license in 2011. The two units use as much as 253 million gallons a day of seawater in their cooling systems, according to the CEC's study. As a result, the operation kills billions of fish larvae each year, which the commission said is contributing to the decline of numerous fish species off Southern California, including the croaker, white sea bass, and corbina. "The water is not just water, it's habitat," said Donna Stone, CEC compliance project manager. She explained that there is no way to mitigate the effect in the open ocean where the bottom is soft, so the only option is to restore adjacent wetlands. Pendergraft argued that the commission's study was flawed because it calculated the marine impacts assuming that the units would be operating around the clock all year long. Company records show that the two units operate only about 25 percent of the time. In addition, he said that the company should not have to pay for permanent mitigation when it can operate the units for only another five years under their CEC-granted license. In other action, the commission deemed complete an application by the city of Vernon to build a 943 MW combined-cycle power plant with three natural gas turbines and one steam turbine. The city is expected to tap new emissions credits that the South Coast Air Quality Management District has made available for new generating facilities.

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