Power unit still on track

The city of Los Angeles won't be investing in the expansion of a coal-fired power plant located near Delta.

But that doesn't matter, according to Utah officials, who say the decision won't derail the project.

On Wednesday, environmentalists cheered Los Angeles Mayor James Hahn's decision to steer the city away from coal-fired electricity sources in favor of renewable energy sources like wind.

Los Angeles was interested in roughly 10 percent to 15 percent of the 950 megawatts of a planned third generating unit at the Intermountain Power Project. Critics charged that the third unit would increase air pollution in national parks in southern Utah.

Yet Los Angeles' decision means more Western cities can take advantage of cheap coal-fired electricity, officials said. Even Portland-based PacifiCorp, which operates in Utah as Utah Power, is now interested in claiming a stake.

Ironically, a third generating unit was originally proposed as a hedge against shocking electricity rate hikes four years ago that crippled California's economy and sent market rates skyrocketing in the West.

"I'm sure there are a lot of happy utilities out there with L.A.'s decision," said Doug Hunter, general manager of Utah Associated Municipal Power Systems. "In the West right now, utilities are looking for 1,500 megawatts of coal-fired generation. Renewables right now are at least 10 to 20 percent more expensive than coal plants."

Reed Searle, general manager of Intermountain Power Agency, a political entity that owns and manages the coal-fired IPP, acknowledged Wednesday that the decision by Los Angeles to pull out did cause some concern. But he said the pull-out would not impede the project at all and that PacifiCorp might now be able to fill the gap.

"We have been in discussions with PacifiCorp about their participating in a major portion of the project," Searle said. "We were actually having difficulties because they wanted more power than we had available for them. Now, if they move ahead with their participation in the project, then this actually solves the major problem for us."

Dave Eskelsen, a spokesman for PacifiCorp, said the expansion of the coal-fired plant is of interest to the utility.

"We have had discussions with IPA in an attempt to better understand this particular opportunity," Eskelsen said. "But right now it is too early to tell if involvement in an IPP expansion would be of benefit to our customers. It certainly is not ruled out as a possibility."