Utilities, aluminum state case
This story was published 6/7/2001
By Mike Lee
Herald staff writer
Hired guns for public power and aluminum companies continued a decadeslong duel Wednesday in Kennewick with their customers' financial futures hanging in the balance.
As the Bonneville Power Administration zeroes in on new regional power rates, public utilities and aluminum companies continue to vie for federal favor and public opinion -- just like they have done time and again for 50 years.
John Arthur Wilson, spokesman for a consortium of aluminum companies, and Jerry Leone, manager of the Public Power Council, defended their positions before about 200 Rotary members and guests at the WestCoast Tri-Cities Hotel. The Mid-Columbia -- indeed, most of rural Eastern Washington -- is a stronghold of support for public power and harbors resentment against profit-reaping giants that want the region's power.
Wednesday's sometimes lively exchange showed just how far apart the groups are in trying to set BPA's priorities. PUDs and aluminum companies play it as an issue of jobs and infrastructure. Without a solution, "There is a very real risk that we could see a regional recession," Wilson said.
But if Bonneville forces aluminum companies out of business for two years -- one option for reducing regional power demand -- there's a good chance they will close for good and sink thousands of families in company towns from Spokane to Goldendale, Wilson said.
"It doesn't make sense that we take an industry and jettison it," he said. "We have to find a way to preserve existing core industries."
Aluminum companies are pressing BPA for a new rate system that would shift about $1.5 billion in power costs to public utilities -- something the PUDs oppose so vigorously that they started a public relations campaign against it last month. "We are gaining support and understanding on the issue," said Karen Miller, government relations manager for Benton PUD.
Faced with the possibility of extraordinary rate increases in October, however, both groups of power customers realize the need to cooperate to fend off California and Northeast power vultures. "The region needs to step together," said Jean Ryckman, director of customer service for Franklin Public Utility District.
There's also a push to insulate the Northwest from California's power woes, which have been exacerbated by what Leone called a "weird and awful" energy market deregulation scheme. Because of the interconnected West Coast power system, "If they have a hiccup down there, we get barfed on up here," Leone said.
Both groups realize the need for new power sources, especially given the possibility that the current drought may extend into next year. "You have two dry winters, and you have reservoirs that are stump farms," Leone said.
"We have had no major new generation for a generation in this region," Wilson said. "We don't have an energy crisis in the Northwest. We have a willpower crisis."
Neither Leone nor Wilson is betting the power crunch will spur completion of Energy Northwest's nuclear plant No. 1 at Hanford. "I am not particularly optimistic about another nuclear plant being built in the country," Leone said. "I'd be surprised if this one (at Hanford) makes it."
The political weight of the environmental lobby also makes new hydropower development unlikely, Wilson said. That leaves natural gas plants, wind farms and a few other power options -- several of which have been proposed across the Northwest.
But so far, Wilson said, companies are doing more site speculation than construction. "We've got to start building," he said.