Methanol plant site
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In a major setback for the Kalama methanol plant, a state board has reversed two big permits Northwest Innovation Works needs for its $1.8 billion project.

The decision could create significant delays for the methanol project and may call into question the entire environmental impact statement the port and county spent years developing.

The state shoreline hearings board reversed the methanol plant’s substantial development permit and the conditional use permit in a summary judgment signed Friday. The parties involved were notified of the decision Monday afternoon.

The six-member board sided with Columbia Riverkeeper, the Center for Biological Diversity and the Sierra Club in concluding that the environmental impact statement did not adequately assess greenhouse gas emissions from the project.

The final EIS estimates that the project would emit 1.24 million metric tons of greenhouse gases annually. That’s roughly the equivalent to the emissions of 260,000 passenger cars annually, boosting the state’s annual greenhouse emissions by 1.28 percent.

Environmentalists argued the actual greenhouse gas emissions from the project are much larger if the entire production process is considered. The EIS only examines emissions from the project site and its immediate vicinity— ignoring emissions from oceangoing vessels hauling methanol to Asia and from the hydraulic fracturing (fracking) of natural gas.

The plant would convert fracked natural gas to methanol, which would be shipped to China to make plastics.

“The Kalama methanol refinery would be one of the largest climate polluters in the Northwest once you consider all of the methane that escapes during fracking (for natural gas) and during transportation,” said Brett VandenHeuvel, executive director of Columbia Riverkeeper.

Northwest Innovation Works officials said they still are evaluating what the decision means for its project. Prior to the board’s decision, the methanol project had most of its major permits in hand. It was not clear Monday evening whether the Port of Kalama or Northwest Innovation could appeal the decision. It also isn’t clear whether the parties must redo the project's massive environmental impact statement or revise just the section on greenhouse gas emissions.

The company said the EIS relied on an official guiding document on greenhouse gas emissions developed by the state Department of Ecology. But the state board apparently found Ecology’s guidance lacking.

“We are disappointed in the Shorelines Hearings Board’s order because the EIS followed both the letter and intent of Ecology’s guidance. ... (The document is) the only guidance in Washington for how an EIS should evaluate greenhouse gas impacts, and Ecology’s website continues to direct state and local governments to use this guidance,” Northwest Innovations President Vee Godley said in a prepared statement.

“We understand that the environmental policy in this state is evolving and we look forward to continuing our collaboration with regulators, stakeholders and environmental and business leaders to do our part to provide greater certainty and positive impact for our state’s economic and environmental goals,” Godley added.

To curb greenhouse gas emissions, Northwest Innovation already has committed to using an ultralow emissions (ULE) technology that would cut emissions dramatically when compared to traditional methanol production. The company says producing methanol from natural gas produces far less greenhouse gas than coal, the traditional source.

Ecology also would require Northwest Innovation Works to reduce greenhouse gases by 1.7 percent annually until 2035.

Northwest Innovation Works' project would create an estimated 192 permanent jobs and 1,000 construction jobs, with an annual payroll of $21 million and $36 million in taxes yearly.

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