Coal fuels energy debate

Truckee-area residents split over whether potential price or environmental threat should dictate choice in power deal.
 


Dec 13, 2006 - The Sacramento Bee, Calif.
Author(s): Edie Lau

Dec. 13--Tonight, with a single vote on a single controversial contract, the board that governs the power supply in Truckee may determine the energy future of the mountain town for the next two generations.

 

The Truckee Donner Public Utility District is wrestling with a dilemma: It can follow a lure of cheap power by committing for 50 years to buy electricity from a plant fueled by coal. Or it can keep buying more expensive power on the open market on faith that electricity from cleaner, renewable sources will be available soon.

 

Either way, the district is taking a gamble that energy providers and users are facing -- how to navigate an utility industry undergoing profound changes driven by worries about global warming.

 

"Nobody has the crystal ball to tell us about this, either way: coal or green power," said utility district board member Joe R. Aguera.

 

The board directs the utility that brings water and electricity to Truckee, a historic Sierra Nevada town off Interstate 80 near Donner Summit.

 

Once obscure, the utility district board has captured the attention of many of its 12,000 ratepayers and made headlines beyond Truckee since the proposed 50-year coal deal was aired publicly in November, spurring immediate controversy.

 

"A lot of people up here are not happy with, mainly, the length of the contract," said Bryan DeVoe, a 28-year Truckee resident and retired telephone service repairman. "We think there are alternatives not that far down the road."

 

Ron Hemig, a utility district board member for 12 years, said the outpouring of community objections took him by surprise.

 

"Until a month ago, we never heard anything from our public except 'keep rates down,' " Hemig said. "The community never spoke to the board ever ... on the subject of coal."

 

What many townspeople apparently didn't realize, he said, is that Truckee already relies on coal to keep the lights on.

 

"Because we've got no generation (of our own), we're at the mercy of the markets," Hemig said.

 

Located a few miles on the California side of the state line with Nevada, Truckee largely is cut off from the rest of California's power distribution because of the way the power grid is structured, Hemig said.

 

As a result, he said, the district obtains electricity from out of state, most of which is derived from coal.

 

That fact also underscores the nation's heavy reliance on the combustible black rock.

 

As of August, coal was the top fuel for electricity in the United States, accounting for 48 percent of power generation, according to the Energy Information Administration.

 

In California, by contrast, natural gas is the top source, providing nearly 38 percent of generation, according to 2005 California Energy Commission statistics. Coal is second, at 20 percent, slightly more than half of which comes from out of state.

 

A law that takes effect Jan. 1 aims to further reduce California's reliance on coal. That law calls for regulations that would prohibit utilities from committing long-term to buying power derived from plants that emit more heat-trapping greenhouse gases, such as carbon dioxide, than is emitted by plants fueled by natural gas.

 

According to the Energy Commission, coal-fired plants emit 75 percent more carbon dioxide per unit of energy generated than plants powered by natural gas.

 

When it takes effect, the California law will bar Truckee from entering into the 50-year coal contract, which is why the board is hurrying to decide the matter -- a pace that has raised eyebrows.

 

"That's not very socially responsible, is it?" said Claudia Chandler, assistant executive director of the state Energy Commission.

 

Hemig said the district has been in discussion for years with Utah Associated Municipal Power Systems, the agency from which they would secure the coal power. It would be generated by a plant that hasn't been built yet.

 

The Utah group would own 50 percent of the plant and sell "entitlement shares" to participating members.

 

Douglas Hunter, general manager of the Utah agency, said Truckee's decision will not affect the plant's future.

 

"Strange as it may seem to California, we're not having any problems selling coal," Hunter said

 

For Truckee district board President Tim Taylor, the issue is a practical matter of dollars and cents.

 

Taylor said Truckee already buys coal power at nearly $50 per megawatt-hour. When its current contract expires in a year, the district may be paying $65 or more. The Utah coal deal promises a cheap and stable price, Taylor said -- about $35 in today's dollars. With inflation, that's $51 per megawatt-hour when the plant comes online in 2012.

 

"What happens if we don't sign and we go out on the open market and prices just keep going up and up and up?" Taylor said, noting that rising electrical rates would have a ripple effect on water and sewage costs.

 

As for global warming, Taylor said the solution will have to come from collective action by all of humanity. "To think that the town of Truckee can take global warming on itself, financially, I just don't see it happening," he said.

 

Like Taylor, Hemig said he's inclined to support the contract at some level, perhaps securing half the town's needs through the coal plant and searching for more environmentally sensitive options for the rest.

 

Two other board members -- Patricia Sutton and Bill Thomason -- said they're opposed, chiefly because the low price for coal is not guaranteed and because the contract life is too long.

 

"As time goes on and regulations apply to carbon dioxide emissions, this plant will have to be upgraded with equipment and changes, and those are going to cost an unknown amount of money," Sutton said.

 

The fifth board member, Aguera, said Tuesday he's undecided. "It's a dilemma," he said.

 

 


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