Great Falls Tibune
October 2, 2008
Rural co-ops confident coal-fired plant will be built By KARL PUCKETT Tribune Staff Writer
Rural electric cooperatives hoping to construct a coal-fired power plant east of Great Falls expressed confidence Wednesday that the project will go forward despite financing, legal and environmental challenges.
"We've fought some battles and we're going to continue to fight until we get it done," said Gary Helm, who serves on the board of directors of the Tongue River Electric Cooperative in Ashland.
Rural cooperatives from across Montana are meeting for their annual convention in Great Falls this week, including Tongue River, Beartooth, Fergus and Mid-Yellowstone Electric.
Those four cooperatives make up Southern Montana Electric Generation and Transmission, which is proposing to construct a 250-megawatt coal-fired power plant eight miles east of Great Falls. The city of Great Falls also has a monetary stake in the project.
Previously, Yellowstone Valley Electric decided to drop out of the project because of concerns about its rising costs, and it hasn't changed its mind, said Larry Kaufman, a member of the Yellowstone board.
"It's a business decision not to be involved in it more than anything," he said.
The environmental community has made it difficult to complete the project and, in effect, cooperatives are being "held hostage" because they can't provide their own generation, relying on buying it elsewhere, Kaufman said.
Environmental groups have challenged the Highwood Generation Station over its air-quality permit and the appropriateness of constructing it in a largely agricultural area. Cascade County, which rezoned the site for the project, is being sued over the decision.
The Rural Utilities Service announced earlier this year it was suspending a loan program for new nuclear and coal-fired, base-load electric generation projects, and SME is now seeking financing elsewhere.
"We still have some concern about long-term financing, but we're relatively confident we can still pull it together," said John Prinkki, a board member of the Beartooth board of directors.
SME is in the process of securing a $10 million to $15 million loan from a private bank to begin the project and continues to work on the long-term financing, Prinkki said.
"I feel good about it," said Joe Dirkson, a board member of the Fergus cooperative.
Work on the power plant needs to begin by Nov. 30 for the air permit to remain valid.
As they have previously, the cooperatives declined to say who might finance the project. "When we get it all squared away, we'll tell you," Dirkson said.