Sierra Pacific Resources is moving ahead
with plans for big coal-fired power plants near
Ely at the same time that everyone from Oprah
Winfrey to John McCain is sounding the alarm
about the role that carbon emissions play in
global warming.
Expecting opposition to the company's
plans, Sierra Pacific Chairman and Chief
Executive Walt Higgins last week sketched out
the company's arguments:
* The two plants a 500-megawatt facility
projected to come on line in 2011 and an identical
plant to come on line in 2013 will allow
the Reno-based utility company to replace
older and dirtier generating plants.
* The technology proposed for the plants
would make them the cleanest in the West.
* They would use low-sulfur coal from the
Powder River Basin ofWyoming, further lowering
their emissions.
* If regulators crack down hard on carbon
emissions, Sierra Pacific Resources will leave
the door open for installation of technology to
capture carbon emissions and store them. So
far, however, that technology doesn't exist.
Talking with securities analysts who have
just as many questions about how the company
will pay for the $3.8 billion facility as they have
about its environmental impact,Higgins said
the company's push into renewables also provides
a talking point.
"I think it's important to look at the totality
of what the company will be,"he said.
With ongoing conservation efforts, the use
of solar, geothermal and wind sources to meet
15 to 20 percent of customers' demand and the
replacement of older plants, he said Sierra
Pacific appears to be positioned to meet fastgrowing
demand without increasing its carbon
emissions.
He acknowledged that the company expects
to encounter opposition as it applies for state
and federal permits it needs for the power
plants and a transmission line to carry the electricity
to the Las Vegas area.
Assuming the company wins regulators'
OK, it will finance the $3.8 billion cost with the
sale of additional stock and debt along with use
of retained earnings, said William Rogers,
Sierra Pacific Resources' chief vice president of
finance and risk.
Higgins noted, too, that the price tag may
rise as the costs of construction materials and
generating equipment continue to increase. The
company expects to have better cost estimates
when it receives proposals from construction
managers later this year.
The company's discussion of the Ely plant
came as it reported first quarter income of
$15.6 million on revenues of $756.4 million.
That compares with income of $1.2 million on
revenues of $707 million a year ago.
Sierra Pacific Power, the company unit that
serves northern Nevada, earned $21.9 million
on revenues of $338 million in the quarter.
