Price signs long-term electricity agreement

By Rick Sherman

The City of Price has approved a purchase agreement which will insure the city’s participation in the renewal of the Intermountain Power Project and repowering of the IPP Power Plant. Following a public hearing, during which no comment was received, the acceptance of the renewal offer from the Intermountain Power Agency was approved by the Price City Council at its regular meeting of April 27. The City Council also approved a resolution to execute and deliver the renewal offer documents.
The Intermountain Power Agency is an organization of 23 Utah municipalities, including Price, formed to finance, construct, operate and maintain the Intermountain Power Project located near Delta. The Los Angeles Department of Water and Power serves as Operating Agent at the facility. Los Angeles, Anaheim, Riverside, Pasadena, Glendale and Burbank have the majority interest in the Project output with generation entitlements of approximately 75 percent. Utah purchasers are positioned to lay-off power excess to their needs, so California partners have taken over 98 percent of the power from the Project since inception.
According to the IPA website, “The Project consistently ranks as one of the most efficient and cleanest coal fueled generating stations of its size in the nation…We remain committed to the use of coal as a fuel source for as long as electricity consumers are willing to purchase the plant’s output.”
But the Southern California municipalities that have historically purchased most of the IPP’s electricity are now prevented by California state law from purchasing coal-fueled electricity after their current long term contracts expire in 2027.
As a result, IPA is now engaged in planning and preparation for the decades after the current power purchase contracts expire. The options include continuing operation as a coal-fueled electric generating station, repowering all or part of the Project to use other fuels, such as natural gas, or some combination of the two.
Price City Community Director and IPA Board member Nick Tatton said the City is currently entitled to 0.361 percent of the power produced by IPP. He said acceptance of the agreement essentially makes the City a partner in the renewal project, and Price could pursue an entitlement of 1.1 percent of the power in the future if other entities in Utah choose not to participate in the renewal.
Tatton said, “We’re not even using the (IPP) power right now,” citing Glen Canyon Dam, and a wind farm in Idaho as among current sources of electric power for the City. But he said the advantages of participating in the renewal include potentially lower energy costs, an electrical infrastructure that is already in place and paid for, and maintaining the option of something to fall back on. There is no cost to Price City unless and until it begins using IPP-generated electrical power.
The purchase agreement is for a period of 50 years beginning in 2027 when the current agreement expires.