A new coal plant that has been proposed in southern Indiana would spew millions of tons of climate change-inducing greenhouse gases and dozens of tons of cancer-causing chemicals into the air each year, according to a draft permit for the facility.

The facility, if built, also will be located within one mile of an elementary school and nursing home.

Still, the state’s environmental agency has determined that those emissions would not exceed any legal limits and, thus, have “no significant impact” — a finding that is drawing some skepticism.

“For the state to claim that this will have no significant impact is, in my opinion, simply false,” said Randy Vaal, a retired chemical engineer who worked in the oil and gas industry for decades.

Riverview Energy Corporation is seeking an air permit for its “clean coal” diesel plant in Spencer County that would turn the state’s abundant coal reserves into diesel fuel. This plant would be the first of its kind in the United States.

Before the Indiana Department of Environmental Managementcan make a decision on that permit, however, it must hold a public hearing to take comments and field questions and concerns. Scheduled for Wednesday in Dale, Ind., this meeting comes nearly one year after the facility was first proposed.

It also comes less than two weeks after the federal government released a National Climate Assessment that outlines dire threats to health, the economy and landscapes. The report says the climate — largely at the hands of humans — is changing faster now than ever in modern history, and the effects of this change can be expected to only intensify.

Still, those in favor of the plant — including the officials who have helped recruit the company — tout the jobs it will bring to the area.

"I'm looking to raise the economic standard of living and am looking for emerging technologies that use our resources," Tom Utter has said. He is the executive director for the Lincolnland Economic Development Corporation focused on advancing Spencer County's economy. "Coal is a perfect fit, and this process is an innovative Nobel Prize-winning process that has a strong market in our fuel-hungry society."

Opponents of the project, who have been growing in numbers in recent months and plan to flood the meeting, argue that is not worth the potential costs to health, the environment, and taxpayer’s pockets.

“Fundamentally, this is the wrong time for this type of proposal,” said attorney Charles McPhedran of the national nonprofit Earthjustice, who has extensively reviewed the permit. “We need to move to clean energy, which looks like a wind turbine, and away from fossil fuels. This proposal takes us back in a way we don’t need to go back.”

IDEM says 'no significant impact'

The Riverview plant won't burn or gasify coal for electricity. In a process known as direct coal-hydrogenation, the plant would combine the carbon from coal and hydrogen from the natural gas at high heat and pressure to produce diesel fuel and naphtha, a flammable liquid mixture that is often used as a solvent or diluent.

More specifically, Riverview Energy proposes to use 1.6 million tons of coal to produce 4.8 million barrels of what it calls clean diesel and 2.5 million barrels of naphtha on an annual basis. That coal will come directly from Indiana's reserves, of which 17 billion tons are readily recoverable with today's technologies, according to Indiana University's Geological and Water Survey for the state.

Other numbers associated with this plant include 2.2 million tons of carbon dioxide, which contribute to the earth’s warming. More than 100 tons of particulate matter, which cause smog and contribute to respiratory issues. And more than 60 tons of hazardous air pollutants, which the U.S Environmental Protection Agency defines as those known to cause cancer and other serious impacts.

Those figures are the amount of pollutants the plant estimates it will emit each year, after controls are put in place, according to its permit. They will be adding to a toxic mix already found in southern Indiana, which is home to a handful of super polluters, or the most polluting power plants in the country.

Spencer County ranks in the top 30 among the nation’s more than 3,000 counties — or the top 1 percent — for toxic substances it releases into the air, according to an EPA database.

“Spencer County doesn’t deserve another source of hazardous air pollutants,” McPhedran said.

IDEM, after a review of the permit application, said that the emissions the plant would release do not exceed any legal limits. In its notice of period for public comment issued last month, the agency said that “no significant impacts are expected from the proposed facility.”

Attempts to speak with IDEM officials were unsuccessful, though the agency maintained the findings in its analysis and provided a factsheet describing the permit and process.

Riverview president Greg Merle said that numbers in the permit describe a limit on emissions, which the company intends to operate under.

"With IDEM experts determining there are no negative impacts, we see the hearing as a productive next step in this valuable project," he told IndyStar. "We look forward to working closely with State experts to ensure this innovative project provides a balance of industry and economic development using Indiana's wealth of coal resources, while still maintaining a healthy environment."

"This is not only possible," he added, "but truly achievable."

Concerns with the permit

Vaal, who now lives in Santa Claus, Ind. just five miles from Dale, said the emissions assume the plant operates perfectly, which he said is unlikely for a facility that is the first of its kind to be built in the United States.

The novelty of this proposal also drew Earthjustice to take a look at the permit, McPhedran said.

“If this were a sort of plant we’d seen 100 times in the U.S., then we’d have a better idea of what some controls are required under law for the plant and to help with emissions,” he said. “But because the plant is one of a kind, there is a lot more room for error.”

The burden is on IDEM to “do its homework” and really dig into the plant and the application, McPhedran said, because the agency doesn’t have a manual on its book shelf it can easily apply to a new facility proposing first-of-its-kind technology.

In one area of the permit that measures and establishes the background pollution levels, the agency used a monitor in South Bend to determine the concentration for nitrogen dioxide — a gas that can aggravate and contribute to respiratory diseases.

This is problematic, McPhedran said. If an agency is not looking at an area or measuring in a way that truly captures what’s in the air, he said, then it is not getting an accurate picture of the pollution and what can or should be done to control it.

It is among this and other concerns that Earthjustice plans to raise at the public hearing and submit to IDEM. It is for such reasons that the organization says they believe the permit should be withdrawn.

Many local residents echo that sentiment.

Mary Hess, who heads the local Southwestern Indiana Citizens for Quality of Life, said they have continued to see those against the plant grow. The group has collected more than 1,400 signatures on a petition in opposition.

More “No coal to diesel” yard signs have sprouted up across town, she said, and a billboard has gone up along Interstate 64 that reads “Gov. Holcomb, please no rotten egg smell, no more super polluters, and no coal-to-diesel in Dale.”

That billboard is on Jerry Steckler’s property. Steckler owns and operates an all organic farm in Dale, and within a mile of where the plant would be built.

“All livestock farmers in this area will feel the effects of the increased ozone from this plant as it will render the animals more heat stressed as it does for humans,” he said, adding this could drastically hurt his business. “As an organic farmer, I strive to work with nature to create a healthy environment in which the animals can thrive. This plant is not a part of that thriving environment.”

Do the economics make sense?

Many have also called into question if this plant is part of a thriving economy.

Riverview’s pitch centers largely around the economics of the project — which the company and Merle call a $2.5 billion investment in Indiana and energy independence — and its potential for the area.

It is unclear how the $2.5 billion project will be funded. Merle has said that it is being privately funded at this time, though that does not mean Riverview would not pursue public or government funding in the future.

The plant’s potential includes the promise of significant revenue for the local businesses as well as jobs — there could be more than 2,000 construction jobs to build the plant and as many as 225 permanent, high-skilled jobs to operate the facility once complete. Riverview also says there could be coal mining jobs that would be bolstered by the plant’s operation, keeping relevant an industry that is competing with — and arguably losing to — natural gas and renewable energy.

"We firmly believe this is an important project, not just for us and the state of Indiana, but for the U.S. and the world and the energy industry as a whole," Merle has told IndyStar previously. "For the near term, we are at least going to slow down taking a lump of coal and lighting it on fire, but that doesn't mean we don't need fuels."

But the economics just don’t make sense to Vaal.

Turning coal into diesel requires purchasing, mining for and transporting the coal. It also requires purchasing and using large amounts of natural gas and other chemicals for the process and processing and disposing of the side products.

“The economics of coal-to-diesel, in a nutshell, require that it must be cheaper than refining crude oil,” the retired chemical engineer said, mentioning the steady decline in oil prices. “My experience indicates that making oil products from something that is not oil will be inherently more expensive.”

Sasol, one of the pre-eminent companies in coal-to-liquid technologies, has found that to be the case. The South African company that has pioneered much of this technology announced earlier this year that it is getting out of the business.

“The basic business case is challenged, in terms of making a return on the investment,” Sasol joint president and CEO Stephen Cornell told South African newspaper Business Live. “The carbon footprint is extremely large.”

Merle has maintained to that this process is both economically viable and is clean, because it does not burn the coal.

If IDEM does approve the permit, Earthjustice will consider if it wants to appeal the decision within the agency or possibly pursue legal action.

Hess said her group also will not stop fighting if the agency gives the plant the go ahead.

“If they reject it, that would be amazing,” she said. “But even if they do approve it, we’re not done. We’re not going away.”

Hearing Details

What: Hearing on IDEM's draft permit for Riverview's coal-to-diesel plant

When: Dec. 5 at 5:30 p.m. Central Time

Where: Heritage Hills High School Auditorium

Address: 3644 E CR 1600 N Lincoln City, Indiana 47552

How: Citizens will have an opportunity to submit written comments and make statements concerning the permit. Comments must be received or postmarked by Dec. 10. and should refer to permit number T147-39554-00065. They should be mailed to:

Doug Logan, IDEM, Office of Air Quality

100 North Senate Avenue MC 61-53 IGCN 1003 Indianapolis, Indiana 46204-2251 Dial directly: (317) 234-5328 or Fax: (317) 232-6749 attn: Doug Logan

E-mail: dlogan@idem.IN.gov

Call IndyStar reporter Sarah Bowman at 317-444-6129 or email at sarah.bowman@indystar.com. Follow her on Twitter and Facebook: @IndyStarSarah. Connect with IndyStar’s environmental reporters: Join The Scrub on Facebook.

IndyStar's environmental reporting project is made possible through the generous support of the nonprofit Nina Mason Pulliam Charitable Trust.