Ruling Blocking Coal-Fired Plant Stands : Environment: The state high court rejects pleas of dozens of objectors to the decision that prevented operation of the nearly completed facility in Hanford.

The state Supreme Court, rejecting pleas from dozens of developers, municipalities and financial institutions, on Monday let stand a far-reaching appellate decision that blocked operation of a nearly completed $70-million coal-burning power plant in Hanford.

The justices, in a brief order, refused to hear a challenge to a ruling last June by a state Court of Appeal in Fresno that critics said could bring costly new delays and uncertainty to building projects throughout California.

The appeal court held that the Hanford City Council, in preparing an environmental impact report on the project, had failed to adequately consider its effect on air quality throughout the region and to fully weigh less harmful alternatives.

The appellate ruling sparked a flood of protests from critics who said that because the court’s environmental requirements were so strict, governmental agencies would be forced to investigate even clearly unfeasible alternatives and allow belated, time-consuming court challenges to city and county general plans.

The state high court, by recent count, had received letters from more than 60 agencies and institutions--an unusually high number for a court case--joining the project’s builder in seeking review of the ruling. The broad range of organizations filing letters included the California Chamber of Commerce; the University of California Board of Regents; Southern California Edison Co.; Los Angeles and San Francisco; Salomon Brothers Inc., the investment banking firm; and the Walt Disney Co., the developer of proposed theme parks in Long Beach and Anaheim.

The justices’ refusal to review the issue makes the appeal court ruling binding on trial courts throughout the state.

A spokeswoman for backers of the Hanford project said further efforts would be made in the trial court to come up with a plan that will meet environmental concerns and allow completion and operation of the facility.

Christopher W. Garrett of San Diego, attorney for the builder, expressed disappointment and said the appellate ruling would have “an enormous impact on the way public agencies grant permits to various residential, commercial and industrial projects.”

E. Clement Shute Jr., a San Francisco lawyer representing opponents of the project, hailed the high court’s action as a display of judicial independence. “This shows the court realizes the Legislature enacted far-reaching environmental statutes and that its job is to interpret them as broadly as it can,” Shute said.

The case arose over the proposed construction of a coal-fired cogeneration plant by GWF Power Systems Inc. to simultaneously provide steam and electricity to the Armstrong Tire Co. and Pacific Gas & Electric.

The tire company was on the verge of closing its plant, with the threatened loss of 600 jobs, but agreed to remain open when the cogeneration plant--a less costly source of energy--was proposed.

Farm and environmental groups strongly opposed the project, saying it would significantly increase air pollution, causing further damage to crops, and reduce ground water levels. But the city’s environmental impact report concluded that the project would have no significant adverse effect, and the plant was approved.

Opponents brought suit challenging the adequacy of the city’s report, but a Kings County Superior Court in 1988 rejected their contentions, upholding the city’s analysis.

But the Court of Appeal, in a 3-0 ruling, held that the city had failed to obtain sufficient information to make an informed decision about whether to approve the project.

The appeal court held that the city had improperly failed to study the cumulative effect of the project on air quality along with scores of other developments--including more than 100 other cogeneration plants--planned in the San Joaquin Valley air basin.