Five Utah cities have approved a contract to participate in a $16 million project to bring surplus electricity from Colorado, and five more are expected to follow suit later this week, according to an official with the state association of municipal power systems.

The Bountiful and Lehi city councils voted Tuesday night to support a 41-year contract to procede with the project. Ephraim, Payson, Murray, Heber City and St. George councils were expected to do the same in meetings Wednesday and Thursday. Springville, Enterprise and Logan had approved the contract earlier.Carolyn S. McNeil, general manager of Utah Associated Municipal Power Systems, said the cities will help share in the $5 million cost of building about 200 miles of power lines from the Bonanza power plant, southeast of Vernal, to Craig, Colo. The cities would also spend $11 million to purchase 54-megawatt capacity on existing lines from the power plant to a substation in Mona, Juab County.

"The advantage is that the cities will be able to interconnect with other utilities," McNeil said.

Every year about 1,600 megawatts of surplus energy is generated by utilities in Colorado. The electricity could be purchased by municipal power systems cheaper than they can generate it themselves. If cities meet their own demands, they could also become brokers of electricity to the lucrative Southern California market.

"The Western Area Power Administration already has the line under construction and we (UAMPS) have given funds in aid of construction. They very much want to get this settled with all of the participants," McNeil said.

The power line from Bonanza to Craig is expected to be completed within a year. After construction of the line, the participating cities would purchase the capacity in Bonanza to Mona lines owned by Deseret Generation and Transmission. Surplus Colorado power is expected to be purchased from Western Area Power Administration, Platte River Power Authority and Tri-State Generation and Transmission.

The 10-city contract allows municipal power systems to sell their part in the project once their debt is paid. If a city defaults, the other cities have the right to sue to cover any debt and sell that city's interest.

UAMPS views the project as a way to be competitive in the transmission market in the face of the Utah Power & Light and PacifiCorp merger. While the merger allows a north-south grid to southern California, the Mona to Craig line will set up an east-west grid from Colorado. Power from the Northwest is also expected to be more expensive than projected costs of the Colorado power through the year 2000, UAMPS officials said.

St. George, Bountiful and Springville stand to benefit the most from the project. St. George will spend $4.5 million, Bountiful will spend $3.7 million and Springville will spend $2.7 million on the project. The cities will be allocated power according to their share of the project cost.

In a joint session of the Bountiful City Council and Power Commission Tuesday, Mayor Dean Stahle said the transmission project is something his city has been wanting for a long time.

"The transmission of power is something we have always wanted," Stahle said. "This is a momentous moment in the history of the power in Bountiful. This is of great value to the residents of the city."

Bountiful plans to finance its share of the project from power department funds until 1991 when it expects a shortfall. At that time the power department would either borrow the money from the city's general fund or bond for it. There is no plan for a rate increase, Cliff Michaelis, city power director, said.

Other cities have considered using UAMPS bonding to fund their share of the project.