Prohibiting construction of a Utah Power & Light substation in southeast Orem could pull the plug on expansion for Signetics Corp.'s Orem plant.
Signetics, with headquarters in Sunnyvale, Calif., is the world's seventh largest producer of semiconductors. Corporate officials have refused to buy improved equipment for the Orem plant until plant officials can prove they have a reliable source of electrical power."Over the last year, we have had five power outages," Neil Bullock, plant manager, said Tuesday during City Council meeting. "Each has cost us between $225,000 and $500,000 in materials."
Without power, most environmental protection systems fail and employees must be evacuated, he said. Work time is lost, and it costs $10,000 in salaries to fix the damage. Each outage means the loss of millions of dollars in sales, he said.
"There is $24 million budgeted for new technology next year, but we can only get it if we have a reliable power source." Otherwise, the funds will go to another plant, he said.
Signetics Orem has an annual operating budget of $98 million, about half of which is used for salaries and benefits for 1,700 employees. It is Utah County's second largest employer after Geneva.
"We can't go forward unless we have assurance of uninterrupted power," Bullock said.
UP&L agreed to supply a backup power source by building a new substation at 825 E. Eighth South, but neighbors protested, saying they fear the facility will increase electromagnetic radiation in the area.
Neighbors asked UP&L to bury the power lines, but company spokesman Kent Jaffa said that would cost $1.3 million per mile. Above ground, the entire project will cost about $500,000, he said.