Truckee’s utility district delays power contract | SierraSun.com

Truckee’s utility district delays power contract

Christine Stanley
Sierra Sun

The Truckee Donner Public Utility District board room was packed Wednesday night when the board met to discuss a 50-year contract proposal to purchase coal-based power from a plant in Utah. Heated public comment lasted more than three hours before the board decided to hold its votes until a later date in November.

Dozens of residents voiced concern about the 50-year term of the proposed contract that would allow the district to purchase a small share of a power plant that hasn’t been built yet.

Other constituents were adamant that coal will prove to be a poor investment, and some discussed options for securing green resources.

“We [got] a lot of feedback, and it was very helpful,” said board President Ron Hemig. “It’s a balancing act, and that’s what I’m going to have to think about. I am going to rethink all of this.”

That balancing act has to do with the fact that the board will need to secure enough energy to sustain minimum daily power needs in Truckee beginning in 2012.

If the board decides to go ahead with the contract, they must approve it before Jan. 1, 2007 in order to avoid a new California law that will limit non-green energy contracts to five years.

The district’s plan to buy into the Utah Associate Municipal Power Systems’ Intermountain Power Project 3 (UAMPS, IPP3) and receive power at half the market price will save the district an estimated $5 million every year, according to district General Manager Peter Holzmeister.

Couple the desire for cost savings with the district’s mission to maintain green practices, and the result is a board stuck between a rock and a hard place.

“We have pursued actively green power during the whole period that we have been planning, but we understand the need to have other sources of power too, and whether we like hearing it or not, the most prevalent power source is coal, Holzmeister said.

“Our thought is that if we can acquire base-power at a cheap price, it [will give] us the economic headroom to go out and buy green power.”

Some board members maintained that if they did not sign the UAMPS contract to purchase power at cost ” just $35 per megawatt hour (MWh) ” then they would have to purchase power at a market value closer to $70 per MWh, and therefore would have fewer resources to focus on renewables.

Many people who opposed the contract disagreed.

“Coal might be cheap at the moment, but I think it’s likely that it will be subject to more taxes and liabilities, whereas clean power will be beneficial in all those regards,” said Truckee resident Dan Favre.

The board tried to provide those in attendance some comfort by acknowledging that the length of the contract is daunting, but that the district can sell their share of the plant and get out if necessary.

Those comments seemed to fall on deaf ears. As did Holzmeister’s comments that 16 percent of Truckee’s power is currently drawn from renewable resources, including hydroelectric, and that the district is “doing better than most.” The district’s 16-percent use of renewables compares to just two percent nationwide, according to the Department of Energy, and eight percent statewide, according to the California Public Utilities Commission.

Running an entire utility district on green energy is a noble idea, the board said, but 100 percent reliance on renewables is, at this point, still out of the question. In the meantime, something ” maybe coal ” will have to fill the gap.

“There is no green power that is going to be available for that base-power use,” Holzmeister said. “We will do our darnedest to get wind and solar, but it’s not easy and it’s going to take time.”