Regulators Approve Utah Power's Plan for New Power Plant

The Utah Public Service Commission has given Utah Power permission to proceed with construction of its proposed $330 million Lake Side Power Plant.

Located on property formerly owned by Geneva Steel, the power plant will be a 534-megawatt natural-gas fired facility that is expected to enter service in the summer of 2007. A megawatt is enough electricity to power approximately 750 homes. Utah Power earlier this year selected Denver's Summit Energy to build the plant. Once constructed, however, Utah Power plans to assume ownership of the facility.

In approving the construction of the facility, the PSC pointed out Utah Power testified that without the plant, the company and its customers could be "exposed to the volatility of the wholesale power market, high transmission costs associated with delivering power to customers in Utah and potential adverse impact on service reliability."

The project was not without its controversy. Summit's selection came less than two months after the company fended off criticism over the way it conducted the bidding and evaluated offers that competed with its own in-house plans to build the 525-megawatt Currant Creek plant near Mona.

In selecting Summit to build the project, Utah Power turned down an offer by San Jose, Calif.-based Calpine Energy, which had been identified early in the bidding process as having offered one of the more economical proposals for construction of a plant on the former Geneva site.

Calpine eventually decided not to participate in the hearings on the Lake Side plant that were held before the PSC in late October.