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Show Bountiful feels it 'took the chance mid now should reap low-cost power Editor! Note: Because of the complex and controversial controver-sial behiad-the-acene activities dealing with hydroelectric hydro-electric power, the Clipper asked the management of both utilities to respond in their own way to his problem. prob-lem. Here are their responses without either writer having knowledge of what the other was writing. By CLIFFORD MICHAELIS Bountiful Power and Light Utahns are proud of their sense of fair play. In recent months, however, we have been subjected sub-jected to a one-sided propaganda campaign sponsored by Utah Power and Light concerning concern-ing the federal power program. Like any controversial issue, this one has , two sides of the story. Utahns are entitled to have a fuller understanding of this issue before making up their minds on the fairness of federal power. Most of UP&L's information has been extremely ex-tremely misleading. Among the most blatant distortions of truth are the arguments that federal fed-eral power is subsidized and that all taxpayers paid for the dams. Luckily for UP&L, most of us don't remember remem-ber what was going on in Congress 30 years ago when these dams were authorized, so this sounds like a valid claim. But let's review the origins of federal power in Utah before we ask "What's fair?" , ' The dams built on the Colorado River were designed as water development projects not power projects. Congress believed they were y necessary to assure the West adequate water supplies for agriculture and commerce, to buffer buf-fer the West from the chronic ravages of flood and drought, and to unlock recreational opportunities. oppor-tunities. But when the cost of these projects was tallied, guess what? Farmers couldn't afford to buy the water. Back to the drawing board. Congress reasoned that ifhydroelectric facilities faci-lities were installed in the dams, power sales .would generate enough revenue to help pay the . total project cost. So on the strength of repayment repay-ment agreements with power users, Congress authorized construction of these massive water projects. Power users will pay 89 percent of the cost of the irrigation features of the Colorado River Storage Project (CRSP). This is in addition to 100 percent of the cost of the power facilities-which facilities-which they are obligated to repay, with interest, in-terest, plus operational and maintenance expenses ex-penses of the dams. Municipal's and industrial water users also bear 100 percent of the cost of their share of the projects, with interest. The truth is that the federal power program doesn't cost the U.S. taxpayer a dime. You can't find a budget expenditure in the federal budget for the federal power program because there is no taxpayer subsidy. In fact, the federal feder-al power program is one of very, very few programs that pays its own way. Not to mention men-tion the additional bonus to the treasury of interest earned on the original investment. ' . Perhaps the passage of time has blurred the memories of some UP&L executives who now want their rate payers to believe they're being shortchanged. Twenty-five years ago, a company com-pany brochure acknowledged the significant contribution of power sales in making the dams possible: "...Inasmuch as electric power must provide the funds to repay to the Federal government most of the cost of the project, the Act intended that power be sold, not at its cost, but at its value to provide funds for early construction of irrigation and other projects to make use of the developed water." Similarly, a letter to the editor of the "Salt Lake Tribune" from UP&L President E. M. Naughton in 1960 reminded the public: '"...The Colorado River Storage Project is a water development project and not a power project. Power is of secondary importance and the law requires that revenues from its sale be used to help pay for water development units of the overall project." Utah Powef and Light understood the funding fund-ing mechanism for the dams 25 years ago. Now it seems the company is trying to alter history to fit its needs. It is true that a small portion of the project costs will not be repaid, that which is allocated to flood control, fish and wildlife protection, the majority of salinity control, recreation and navigation. These benefits were intended to be enjoyed by all, and that's why their cost will not be recouped. Economic development of the West would unquestionably have been stymied without with-out the dams. So judging by our density and prosperity I'd say the U.S. taxpayer has enjoyed en-joyed quite a return on his investment. So what about fairness? After making house payments for 25 years, would it be fair for your neighbor to move into your house, because his own payments are higher than yours? That's essentially what UP&L proposes to do now. Now that UP&L's cost of power is more expensive than CRSP, it is trying to take the low-cost resource which 25 percent of Utah's population relies, upon. Why didn't UP&L challenge the federal power marketing policies 25 years ago to gain an allocation? Wasn't the high cost of CRSP worth fighting for? At the same time Bountiful and other public , power utilities stepped up to help pay for the water projects through their power rates, they could have built their own coal-fired plants. Those built by Utah Power and Light and other investor-owned utilities in the early 1960s produced pro-duced much cheaper power than what we agreed to pay for CRSP. Furthermore, CRSP remained more expensive for 12 years, until the energy crisis pushed up the price of coal. Now that power users, of which Bountiful City is one, have already repaid 68 percent ot the original cost of the power facilities, is it fair for UP&L to rewrite the rules of the game? Utah Power and Light is a deeply troubled company. Whatever it can do to build ratepayer rate-payer support regardless of the fairness and equity vis a vis their fellow Utahns is easily justified by the need to win public favor. The motivation is understandable. But this particular particu-lar ploy does not represent the sense of fair play Utahns are proud of. We need the competition that comes from the mixture of Investor Owned Own-ed Utilities and Publicly Owned Utilities because be-cause this competition is good. If UP&L succeeds suc-ceeds in this battle then they succeed in doing away with their competition. Then what will be used as a yard stick to measure UP&L's performance? |
