By Sharon Salyer
Herald Writer
The Snohomish County PUD could take its first step today toward building a new gas-powered generating facility by approving a proposal to lease pipeline capacity.
If all the gas were used in one facility, it would fuel a plant that could produce 240 to 245 megawatts of power each hour, said John White, assistant general manager.
The reason the PUD is looking at a gas generator is that it may not have adequate power to meet demands by either late in 2005 or in 2006, White said.
The pipeline leasing proposal is being considered during a special meeting of the three-member PUD commission. The board oversees a power cooperative that provides electricity to 240,000 residential customers in Snohomish County and on Camano Island. Discussion is expected to begin at 1:30 p.m.
The topic, originally scheduled to be discussed last week, was delayed until today because Commissioner Kathy Vaughn was recovering from surgery.
If approved, the agreement would reserve space in the Northwest Pipeline System so the PUD could ship 45,000 million BTUs of gas a day.
The suggested proposal is for 15 years, White said, and the net cost of the pipeline leasing would cost the utility about $3 million a year. Although the annual total cost would be $6.6 million, about half of the capacity would be resold to other buyers, he said.
The capacity to ship the natural gas would be available to the PUD in mid-2003, White said.
"Even if the board gave us authority to look at gas-fired turbines, it could be months or a year before we’re ready to make the final decision," he said.
It could take about three years after the pipeline capacity is available for any power facility to begin producing electricity, he said.
If the PUD decides to back out of the deal, it could cost as much as $650,000, White said.
Residential power rates will increase 18 percent Oct. 1. PUD officials have maintained that the rate hike was needed to cover increases the utility itself is paying for wholesale power.
The pipeline lease isn’t the reason for the rate increase, White said.
The estimated $3 million annual pipeline capacity costs "would be less than 1 percent in (power) rate consideration," White said.
"I would say it’s likely to help us reduce costs and stabilize our costs," he said, noting that the cooperative is worried it will not have enough power to meet demand in as little as three years.
The PUD must notify the pipeline company of its intentions by the end of September, White said.
"What happens in the natural gas business is capacity is a kind of commodity," said Michael Gianunzio, PUD attorney. "At different times and for varying reasons, capacity opens up and you’ve got a certain amount of time to buy it."
Pipeline capacity, particularly in the Northwest, "is a pretty scarce commodity right now," added Eric Christensen, PUD associate general counsel.
You can call Herald Writer Sharon Salyer at 425-339-3486 or send e-mail to
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
