Business

Gateway West Power Line Will Dominate Future News Of The West

GUARDIAN editor Dave Frazier toured the coal fields of Wyoming this summer as part of the day job at his DRFPHOTO.COM His observations in photos and words. ALL PHOTOS AND TEXT COPYRIGHT DAVID R. FRAZIER

It falls under the name of “Gateway West, but the issue is electricity, who wants it, who can sell it, and who doesn’t want it in their backyard.

The thousand-mile transmission project that would stretch across Wyoming and southern Idaho remains under review by the U.S. Bureau of Land Management. Proposed by Idaho Power and Rocky Mountain Power, its necessity would be determined by the Idaho Public Utilities Commission if it earns BLM approval, possible by June 2013.Right now it isn’t popular in places like BURLEY.
The battle lines are being established before the power lines in what will probably be the next major environmental issue facing Idaho and Wyoming.

The players come from the usual greenies and conservative business camps, but their positions are yet to be spelled out. At the center of the issue is Wyoming Coal. Some producers claim the state has 800 years of reserves and they are doing their best to dig it out and sell the black rocks to electrical generators.

There has been a big discussion about building a port facility at Bellingham, Washington to export coal to China, but the greenies don’t like the environmental impacts and the conservatives hate to see USA resources exported to China only to return as computers and televisions–thanks to cheap electricity.

After years of sending massive “unit trains” laden only with coal to the far reaches of the USA from Gilette, Wyoming, things like the Gateway West project could see producers exporting electricity over gigantic power grids…the idea being it is easier to sell ready-made power than getting permits to build “clean burning” coal plants.

Coal means jobs in Wyoming, so politically it is easier to build coal-fired plants in that sparsely populated state than in the metro areas that consume the power.

Some say the power lines are only for the benefit of big business to sell to the massive consumers in the Southwest areas of Las Vegas and Los Angeles. Others say it will mean jobs and economic growth in Boise. Still others don’t object as long as the lines don’t cross their land or scenic vistas.

Comments & Discussion

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  1. Here’s a Web site that has been setup by proponents of Gateway West:

    http://www.gatewaywestproject.com/

    It would seem, at first glance, that this could have an absolutely huge impact on various, big corporate players in our state.

    Why? Easy…

    Read the various histories that are available in the local libraries about Idaho Power and how Boise corporate interests have aligned themselves politically/economically over the years. One of the most interesting accounts is in the notorious book: “The Boys of Boise” written in 1965 by John Gerassi. Gerassi wrote a chapter called “Public Poverty And Private Power” that went to the heart of his blistering critique of Idaho, in general.

    In the 1950s, a major Idaho political debate was all about Hells Canyon and electrical power.

    In those days, Idaho Power management/shareholders (and many important Idaho political power brokers) generally opposed creation of a massive federal dam at Hells Canyon. Instead, they supported Idaho Power’s more modest alternative, a private-sector proposal, which called for a much lower dam. And the rest is history. (Idaho Power’s dam was constructed.)

    The proposed federal dam would have been much higher. Some federal dam proponents wanted to go even further, creating a New Deal type of “Columbia Valley Authority” for the Pacific Northwest in addition to more BPA power throughout Idaho to boost economic growth. They argued that Idaho’s (Boise’s) corporate club was attempting to block progress and limit/control access of out-of-state industry to local electrical power.

    In “The Boys of Boise,” Gerassi quotes F. P. Hendrickson, former head of Monsanto’s Soda Springs, Idaho phosphate operation on page 141.

    Hendrickson reportedly alleged that Monsanto — based in St. Louis, Missouri — was bitterly disappointed with its negotiations for electrical power with both Idaho Power and Utah Power and Light. He reportedly claimed that the massive quantities of reasonably-priced electrical power required for a gigantic Monsanto expansion at Soda Springs in Southeast Idaho were virtually impossible to obtain. (Monsanto instead expanded in Tennessee.)

    Consequently, Gerassi asserted that Idaho’s economic growth was being controlled by Boise-based corporate interests at the expense of jobs for Idahoans that otherwise might have been created in Idaho by corporations headquartered in other states. Gerassi even claimed that the Simplot company was opposed to BPA power because it might allow Monsanto to setup competing plants.

    This “Gateway West” transmission line does raise a lot of interesting economic questions.

    Is is possible that Monsanto — frustrated by the lack of power in the 1950s — might gain additional access to enough electrical power to facilitate a major expansion at Soda Springs? The map on the “Gateway West” Web site, at first glance, seems to suggest that Soda Springs and Caribou County might be potential electrical power beneficiaries. Electrical power issues are so complex. I wish we could find a reliable source of information that might help frame the issues.

    I wonder if there are any competing power line proposals being made… ?

    Thanks for this. I’ll be reading as much as I can find about this in the days ahead.

  2. All kinds of interesting material is on the Idaho Public Utilities Commission Web site:

    http://www.puc.idaho.gov/internet/cases/elec/SUP/SUPE1101/staff/20110914OBJECTION%20TO%20PROPOSED%20AGENCY%20RECORD,%20REQUEST%20FOR%20HEARING.PDF

    http://www.puc.idaho.gov/internet/cases/elec/PAC/PACE1007/intervenor//MONSANTO/20101014PESEAU%20DI.PDF

    It’s too bad we don’t have a larger, stronger news media presence to put the necessary people and time and resources into the study of this project so that we could get a better handle on the players, the potential winners, the potential losers, the competing interests, the impact on rates, etc.

    EDITOR NOTE–You are doing just fine. “You report, we post.” Once it hits the GUARDIAN–however sparse in detail–the legacy media seems to pick it up as their own. The truth eventually reaches those who want to hear and read it.

  3. Great idea, but I bet people like Team Dave and Obama gave the contract to a foreign company? And of course all the studies will cost more than the power line. Plus a green fee to the end user.

    PS: I’ve heard the legacy media reporters, the few who live in the State, are pizza drivers on the side.

    EDITOR NOTE–only the rich ones drive pizza.

  4. The Twin Falls Times-News reported yesterday that the Obama Administration — in a bid for jobs — is contemplating a “fast track” process for the “Gateway West” project:

    http://magicvalley.com/news/local/transmission-lines-on-fast-track-what-s-that-mean/article_567c9fce-f483-11e0-b6b6-001cc4c002e0.html

    The “Gateway West” is apparently just one leg of a much bigger proposed system, which has a total projected cost of more than $6 BILLION.

    You would think the news media in the Boise area would consider this to be of some interest, but I haven’t seen much about this.

    The public meeting schedule that I saw on one of the Web sites indicated one of the Boise public meetings had been scheduled around the noon hour. Many of us have to work during those hours.

  5. Looks like Rocky Barker did do a small story a few days ago:

    http://www.idahostatesman.com/2011/10/05/1827609/obama-proposes-streamlining-permitting.html#storylink=misearch

    “The Gateway West Project is estimated to create between 1,100 and 1,200 jobs.”

    I wonder if rates will be fairly applied to Idahoans.

    According to the Web site of PacifiCorp, this “Gateway West” project is just one component of a much bigger system called “Energy Gateway.” See:

    http://www.pacificorp.com/tran/tp/eg.html

    So the question that I don’t see answered yet in any of the news articles is whether Idahoans — with rising bills for electricity — will be fairly charged.

    The jobs component sounds great; the modernization of the grid sounds great.

    But Monsanto’s consultant says:

    “If PacifiCorp succeeds in completing the entire Energy Gateway project by 2020, the company will dominate transmission services throughout the western U.S. This circumstance would place shareholders in the enviable position of earning a return on over $6 billion in new rate base as well as providing the ‘highway’ to California and southern Nevada for sale of PacifiCorp’s existing and developing wind projects.”

    Monsanto’s consultant continues:

    “The reason I say ‘enviable’ is because, unlike unregulated third party developers of new transmission facilities, PacifiCorp is attempting to earn on Energy Gateway immediately by placing the large, initially over-built segments into rate base as each is completed. Private third party developers are not, of course, able to earn on the excess investment prior to the facilities reaching full capacity and coming on line, when they then can charge OATT wheeling tariff rates.”

    http://www.puc.idaho.gov/internet/cases/elec/PAC/PACE1007/intervenor//MONSANTO/20101014PESEAU%20DI.PDF

    Hmmm.

    The complexity of a topic like this just points to a rather gaping weakness in our so-called democracy, in my view. A project of this magnitude. And yet… the vast majority of dumbed down, over-the-air, corporate-owned news, in particular, focuses on the weather. How can ordinary people in society participate and help decide in such a circumstance? Sad.

  6. A little more meat in yesterday’s story by Barker:

    http://www.idahostatesman.com/2011/10/12/1836271/huge-power-projects-likely-but.html#storylink=misearch

    One big irony suggested by the story: a slowing economy is causing falling demand for electricity.

  7. local broadcast media.. take away weather, and take away sports, and take away repeats of national news. Isn’t a lot left.

  8. PacifiCorp — headquartered in Portland — does business as “Pacific Power” and “Rocky Mountain Power” as explained here:

    http://www.pacificorp.com/about/co.html

    PacifiCorp’s $6 billion “ENERGY GATEWAY” — which includes the “Gateway West” segment planned for Idaho:

    http://www.pacificorp.com/content/dam/pacificorp/doc/Transmission/Transmission_Projects/2669-20_EnergyGateway_FactSheet_v5.pdf

  9. PacifiCorp is owned by MidAmerican Energy Holdings in Des Moines, Iowa:

    http://www.midamerican.com/aboutus2.aspx

    And, finally, MidAmerican Energy Holdings in Des Moines, Iowa is a holding company controlled by Berkshire Hathaway and Mr. Warren Buffett:

    http://www.berkshirehathaway.com/subs/sublinks.html

  10. Thanks for all the facts Jerry.

    Best I can figure out, we may build this concept, but the bottom line will be gigantic and the end user will not have the money to buy the end product. However, that’s not what matters to those planning and building the project. They know they can count on government to pry the money from taxpayers. The planners and builders just live for the quick money. Long-term viability is not important to them. This disconnect is what is wrong with the country. It’s a very simple business and political ethics issue.

    Many decades ago, a project like this would happen in just a couple of years and have an affordable end product. Our hydropower system is a great example of that. China has taken over the lead in world manufacturing power, or will be soon, because they build things like this with efficiency for an affordable end result. China, like Japan before them, learned from us. (Although neither served their average citizen as well as we did.) We have forgotten what holds the roof up, and no longer focus on maintaining that basic structure for the people in the middle. The people in the middle are just there to be squeezed.

    PS: Nice house for sale, cheap! Need to move someplace without so many taxing districts.

  11. In “The Boys of Boise” chapter called “Public Poverty and Private Power,” author John Gerassi, writing in 1965, computed a simple monthly electrical bill comparison table for the years 1938 to 1963.

    Gerassi – who now holds a Ph.D. from the London School of Economics and Political Science—also noted the following:

    “Idaho Power Company is not an Idahoan company. It is owned mostly by Middle Atlantic and New England companies—70 percent of the common stock. Only 6 percent of the stock is held by people or firms in the Idaho area. It is a very profitable company, having paid out $6,700,000 in dividends in 1964. It has no interest in providing Idahoans with cheaper service. In fact, its rates are higher than its neighboring equivalents.”

    Gerassi then provided the following table:

    Idaho Power: $8.60 in 1938 — $9.95 in 1963
    Percent change: +15.7

    Pacific Power & Light: $8.07 in 1938 — $6.40 in 1963
    Percent change: -20.7

    Portland General Electric: $8.07 in 1938 — $6.40 in 1963
    Percent change: -20.7

    Puget Sound Power & Light: $7.95 in 1938 — $6.79 in 1963
    Percent change: -14.6

    Washington Water Power: $9.15 in 1938 — $7.05 in 1963
    Percent change: -23

    It would be interesting to verify the information in Gerassi’s table.

    In more recent times, we constantly hear that power costs in Idaho are less expensive than power costs in other states.

    Or are they?

    It depends.

    While it’s true that residents in Pacific Coast states such as California, Oregon and Washington in recent times appear to bear significantly higher average monthly electricity bills than do residents in Idaho, I was rather surprised when I decided to do a quick check of the monthly bill comparison table now being published by the U.S. Energy Information Administration here:

    http://205.254.135.24/cneaf/electricity/esr/table5.html

    This table suggests that residents of Wyoming, Colorado, Utah and New Mexico pay *lower* average monthly residential power bills:

    Idaho: $76.01
    Wyoming: $73.56 (3.2% less )
    Colorado: $68.80 (9.5% less)
    Utah: $65.36 (14% less )
    New Mexico: $63.24 (16.8% less)

    Please check the table here…
    http://205.254.135.24/cneaf/electricity/esr/table5.html

    …to verify the figures I just typed.

    Assuming I’ve got the correct figures, what would explain this?

    Granted, the table suggests that significantly lower consumption in Wyoming, Colorado, Utah and New Mexico helps to explain the lower average monthly power bills.

    But why?

    Are residents in those states living in more green, energy-efficient dwellings?

    In addition, Idahoans face new potential rate hikes.

    If and when those rate hikes are approved, how will they change Idaho’s comparison to other Rocky Mountain states, in terms of average residential monthly bills?

    The monthly bills are certainly higher in U.S. coastal states, but average wages in those coastal states are often significantly higher than average wages in Rocky Mountain states such as Idaho.

    Also, the U.S. Energy Information Web site indicates a new table with fresher figures will be available next month. It will be interesting to see what changes have taken place.

  12. Love all the facts Jerry. Still looking for a place to hide. If only my bill was a true indicator of the tax/fee structure. They’ve got so many ways to hide the tax increases these days. Like paying for our own water to be provided and then charged even more for it to be dumped in our river.

    http://retirementliving.com/RLtaxes.html

  13. One clarification:

    The figures in the Gerassi table were said to be “monthly bills for residential consumption of 500 kilowatt-hours.”

    Kind of makes one nostalgic to see monthly bills that low!

  14. Remember that few people had air conditioning in 1964 or electric heat, TV’s, and microwaves. Remember the Boise Cascade all elecric houses with heating coils in the ceiling? What a bomb that was and a rip off to the people who bought the homes.
    Corporations are basically lying when ever they print something. Oh yeah..that’s why they’re people now.

  15. Without a world war to break the ice and a steady stream of political and corporate nincompoops prioritizing absolutely everything before the American people, it’s going to be a long while before we’ll need a new power line.

    http://online.wsj.com/article/SB10001424052970204774604576628981208827422.html?mod=WSJ_hp_LEFTTopStories

  16. One more fascinating link:

    http://www.idahofallsidaho.gov/wwwroot/userfiles/files/ifp/ifp_history_correction.pdf

    This link will take you to the Web site of the City of Idaho Falls where citizens enjoy service from a municipal electric utility.

    This historical account is just fascinating because it confirms what Gerassi wrote about Idaho Power’s historic opposition to BPA power.

    On page 12 of this 26-page PDF history, one reads the following:

    “Not everyone was happy with BPA’s encroachment into the southern half of the state. T. E. Roach, Idaho Power’s president in Boise, termed it ‘a bold, arrogant pressure play by the vindictive public power group…’ (Tollefson 1987). For Idaho Falls, which almost immediately signed an agreement with BPA, the entry of the Portland-based utility into the southern Idaho marketplace seemed a godsend.”

    If you read this history of the Idaho Falls municipal power utility, you will also learn that the creator of the system was Joseph A. Clark who was elected as mayor of Idaho Falls in 1900.

    Clark was the father of Barzilla Clark.

    Barzilla Clark would later also be elected as mayor of Idaho Falls and ultimately would be elected as governor of Idaho in 1937.

    And, of course, Barzilla Clark’s younger brother, Chase Addison Clark, would also be elected governor of Idaho in 1941.

    Chase Addison Clark was the father-in-law of Idaho Senator Frank Church (D-Idaho).

    http://www.idahofallsidaho.gov/city/city-departments/idaho-falls-power/about-us.html

    Power is a fascinating topic. Whenever I get spare time, I read about it.

  17. Another story with some real “meat” in it:

    http://www.capitalpress.com/content/dw-power-hike-010711

    Rate increases might begin to be a fact of life for Idaho, the stories suggest:

    “The steepest rate increases — 9.6 percent and 9.4 percent — will be paid by Monsanto and Agrium Inc., both of which operate phosphate mining operations near Soda Springs.”

    “If fertilizer prices increase as a result, farmers will feel the pinch, Thompson said.”

    “Rocky Mountain Power had originally sought rate increases of nearly 20 percent for the phosphate operations.”

    “Monsanto’s elemental phosphorus plant at Soda Springs is Rocky Mountain Power’s largest customer.”

    “It consumes an average of about 1.4 million megawatts of electricity at an annual cost of more than $42 million, company representatives said in written filings with the utility commission.”

    “The plant’s power demand is about the same as residential power demand in Kansas City.”

    Wow.

  18. Facts about Monsanto’s Soda Springs, Idaho operation:

    http://www.monsanto.com/whoweare/Pages/about-mining-operations.aspx

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