The Western Area Power Administration's ruling that Utah Power & Light Co. is not entitled to an allocation of federal hydroelectric power from the Colorado River Storage Project has been upheld by the U.S. 10th Circuit Court of Appeals in Denver.
The ruling upholds a summary judgment in WAPA's favor issued last year by federal District Judge J. Thomas Greene. That ruling, however, requires WAPA to conduct a marketing criteria environmental impact statement that could affect the total amount of hydropower available to municipal customers who receive allocations under WAPA's preference criteria.Both WAPA officials and representatives of the Intermountain Consumer Power Association expressed pleasure at the ruling.
Lloyd Greiner, WAPA area manager in Salt Lake City, said the ruling should settle the preference issue concerning UP&L claims that first surfaced in 1983.
"We think that this case, because of the issues it raised, will put issues of administrator discretion to bed once and for all," Greiner said.
UP&L has sought an allocation of the cheaper hydropower contending that it was entitled to a share because it services some 100 municipalities in Utah. Federal law gives municipalities preference in seeking allocations from federally financed facilities.
WAPA preference criteria interprets that requirement to apply to city-owned utilities and not private utilities that simply provide service to customers within incorporated cities.
Alene Bentley, ICPA spokeswoman, said her agency has heard about the ruling but has not seen a copy.
"It's an issue that have struggled with since long before UP&L filed its lawsuit in 1986," Bentley said. "We are pleased to hear the 10th Circuit has upheld preference and the discretion of the Western administrator to allocate federal hydropower."
About half the power used by ICPA members the past three years has been supplied by the Colorado River Storage Project.
Greiner said the EIS effort is under way and that WAPA hopes to hold a series of workshops on alternatives available for meeting future contracts with municipalities this fall. He said EIS completion is still on track for late 1993.
Greene's ruling allowed WAPA to implement new contracts with participating municipalities in October 1989 when the original contracts expired. The contracts contain a clause that will allow WAPA to alter allocations if the results of the EIS require that action.
Bentley noted that while resolution of the preference issue is good news, the cities and rural electric co-ops affected by the EIS could still be significantly affected if the EIS forces major changes in hydropower generating operations.
Setback for UP&L
Electricity produced by dams generally is less expensive that what is generated by burning coal or other fuels, and Utah Power & Light Co. had hoped to lower its costs by getting a share of power produced at federally owned dams.
But the Western Area Power Administration allocates its electricity only to city-owned power companies. UP&L claimed that because it serves more than 100 cities the company also should get a share of hydroelectric power, even if the cities it serves don't own the utility.
But a federal appeals court has upheld a ruling that UP&L does not have the same rights as city-owned companies to the cheaper power source.