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Show Utility reaches accord with Nevada power firm Utah Power & Light Co. has signed a long-term contract for the sale of power to Nevada Power Co. The sale, which would begin in 1990, is an innovative arrangement arrange-ment that blends resources of UP&L and Pacific Power & Light Co. UP&L officials said the sale is a good example of what could be done more frequently and more easily if a proposed merger of UP&L and PacifiCorp is approved. Under the contract, UP&L will sell 140 megawatts of power to Nevada Power Co. for up to a 20-year period. During the first nine years of the contract, 50 megawatts will be "base capacity" capac-ity" power that is delivered around the clock throughout the year. The other 90 megawatts will be "summer peaking capacity" capac-ity" power tha is delivered 60 percent to 75 percent of the time during the season from June 1 until Sept. 30. : UP&L will provide the 50 megawatts of base capacity from its own system. The 90 megawatts of summer peaking capacity will be provided through an arrangement UP&L has negotiated with Pacific Power and Light Co. The contract with Nevada would be renegotiated for the 1999-2010 time period to reflect any changes in power usage that may occur during the next decade. UP&L customers would receive significant benefits from the Nevada sale because it allows UP&L to reduce its surplus generating capacity. Frank N. Davis, president and chief executive officer of UP&L, said the sale is an example of taking advantage of diverse resources throughout the region. "We feel this sale represents a win-win-win situation," Mr. Davis said. "Nevada Power benefits by receiving a cost-effective cost-effective power resource that will help postpone the need to build expensive generating units. Utah Power benefits by significantly signi-ficantly reducing the amount of surplus power it has to sell. Pacific Power benefits by making productive use of generating capacity that might otherwise sit idle during their off-peak months." Mr. Davis said the key to the power sale was months of negotiations that were able to piece together the resources of more than one company to create a proposal that fit the specific needs of Nevada Power. "UP&L has proposed to merge with PacifiCorp, whose electric operations are Pacific Power & Light," Mr. Davis said. "If the merger goes through, that kind of resource flexibility will be built into the merged companies. That could make future sales like this one even more common." The sale would require UP&L to complete construction of a 345. 000-volt power line from the Richfield area to the Nevada border, where it would connect to a similar line to be constructed con-structed by Nevada Power Co. A 21 -mile portion of UP&L's power line is already under construction this summer to improve im-prove electrical service to southwest Utah. The new transmission line to Nevada would create additional benefits beyond the initial sale. The line would provide a pathway path-way for additional sales of firm and surplus power. It would also vastly improve the reliability and quality of electric service in southwest Utah. UP&L will seek approval of the sale from state regulators and the Federal Energy Regulatory Commission. |