Utah's energy outlook is surging

Utah should be able to meet its demand for electricity for the foreseeable future, according to the leader of the state's largest electric utility.

Rocky Mountain Power President and Chief Executive Officer Richard Walje told the Deseret News on Thursday that despite growing demand and concerns about long-term future production capacity, Utahns should be well positioned for years to come — thanks, in part, to the slumping economy.

"We're in a real good position," he said. "The economic slowdown has delayed (the need for) some of the resources we thought we were going to have to bring on by up to a year or two, and in some instances, three years."

Walje was among the featured speakers at the Western States Energy Conference at the Grand America Hotel in downtown Salt Lake City. He said that because demand has decreased significantly in recent months, the utility now has more time to develop its plans for meeting future growth in electricity demand.

"Right now, for the next 10 years, we don't see any problems at all," Walje said.

He warned, however, that there might be challenges ahead, depending upon the regulations placed on utilities regarding environmental concerns such as management of carbon emissions.

"If someone were to say, 'Cut carbon-dioxide emissions by 50 percent in 10 years,' then we would really be scrambling to figure that out," he said. "But right now, with everything that is being proposed that could be enacted with legislation, we'd be able to figure it out."

While electricity generation was not a major concern for Walje, he told the audience of about 100 people that the construction and placement of new transmission lines is the single biggest challenge facing his utility. He said companies that manufacture the necessary equipment are in short supply, as are trained tradesman such as electrical engineers, welders and linesman.

"We fly welders in from the Far East and Poland," he said. "In fact, the single hardest craft to fill in America is a certified welder."

He said that in order to build the infrastructure needed to transmit power reliably in the future, those issues must be addressed.

In addition to Utah's electricity outlook, the forecast for natural gas was described as stable by a regional analyst at Thursday's conference. Rocco Canonica, director of energy analysis for Denver-based energy analytics firm Bentek Energy LLC, said prices for natural gas nationwide are falling, which bodes well for consumers, at least in the short term.

"There's been an oversupply on the market for quite a few months now," he told the Deseret News. "LNG (liquified natural gas) is coming in from overseas … At the same time, they've found all this unconventional natural gas in shales and 'tight sands' all over the country … and they've produced a lot of it."

He said the increased supply would likely push prices down for the time being, but the situation could change quickly.

"Producers typically produce a lot of gas … but now, production is flat, and they are adding more pipeline capacity. Prices have the potential to go up," Canonica said.

"There is reason to be happy right now if you are a buyer or consumer, because prices are weak, but … you've got to be wary if you're a buyer … and be watching the market for an overall increase."

E-MAIL: jlee@desnews.com