Lack of rules is cited in power-plant building

A lack of rules and inaction by a legislative task force are some of the reasons for the frustrating and contentious bidding process to build new power plants in Utah, a legislator said Wednesday.

Rep. David Ure, R-Kamas, blamed the Legislature's Energy Policy Task Force, on which he sits, for many of the problems surrounding the bidding process of Portland-based PacifiCorp, which operates in Utah as Utah Power.

"It's a battle of attorneys. It's a battle of propaganda," Ure said. "But I'm frustrated as a legislator, and I guess I'm putting 95 percent of the blame back on this body, on this side of the table, for maybe not mandating two or three years ago to both you people and to the (Utah Public Service) Commission to write the rules."

The utility's bidding process was hotly contested earlier this year after Utah Power selected itself to build the $350 million Currant Creek power plant near Mona, Juab County, from more than 100 other bids by third-party companies.

The Public Service Commission, charged with utility oversight, maintained that the process was fair and that PacifiCorp's decision to build the plant was the most economical choice.

Yet one of the losing bidders, Texas-based Spring Canyon Energy, continues to maintain that it could have built the same plant for $310 million, $40 million less than PacifiCorp's self-build option.

Ure described the bidding process in terms of endless arguing with millions of dollars being spent on "nothing that comes of good to the public."

"I just think a majority of the blame lies on this side of the table," Ure said. "We should have been mandating a long, long time ago through administrative rules. . . . I think there are fallacies in the whole process all the way through."

Artie Powell, an economist with the Utah Division of Public Utilities, agreed that life would have been easier if rules were in place.

"A group of primarily large industrial users asked the commission to take a look at this," Powell said. "One of the claims in their application was that Utah has no rules. I kind of thought that was probably an overstatement. As we began to study it, I realized that it's right."

Rep. Chad Bennion, R-Murray, reminded the task force that in 2003 he sponsored a bill that would have implemented new rules surrounding the bid process for electrical generation. That bill died, he said, because legislators believed sufficient rules already were in place.