March 2, 2024 - Utah lawmakers passed a measure Thursday that allows the state to purchase a coal-fired power plant operating in Delta that now serves California customers and some local cities.

The measure is not intended to interfere with the Intermountain Power Agency’s transition to natural gas and potentially hydrogen in the next few years, but puts Utah in the game to acquire the assets — plus water rights — should it chose.

SB161 faced stiff opposition by Democrats and clean energy advocates who believe the measure continue’s the state’s penchant for coal, when across the country power plants are being shuttered under increasing pressure by both regulators and non-governmental organizations.

In that theme, Utah House Minority Leader Angela Romero, D-Salt Lake City, issued a blistering statement.

“SB 161 Energy Security Amendments demonstrates the Utah Legislature’s support for the declining coal industry. Under this bill, the state can acquire the Intermountain Power Project’s coal units which will require significant investment from the state to sustain the operation of the plant. Concerns of the actual owners of the plant, including 23 Utah municipalities that operate their own power systems, have been left out of the debate,” she said.

Romero added the successful passage of the bill means Utah is turning its back green energy.

“The state of Utah needs to start investing in cleaner energy sources that would better serve Utahns. By prioritizing coal preservation over fiscal responsibility and environmental sustainability, this bill overlooks the opportunity for our state to invest and transition to renewable energy sources for the benefit of current and future generations.”

But the move comes after an audit released last year by the Office of the Legislative Auditor General found a startling lack of transparency regarding the Intermountain Power Agency, which during the course of the review blocked access by auditors to some meetings and documents.

The audit found that the plant operated with little Utah government oversight, despite being set up decades ago as a political subdivision of the state. Of particular angst to some lawmakers is the fact that California receives 98% of the power but IPA is using Utah water and stopped using Utah coal to run its 1,900-megawatt plant. When it transitions to natural gas as mandated by California’s clean energy standards, it also plans to purchase that fuel from Wyoming, not Utah.

Additionally, its annual budget of $520 million is within the purview of a board of which 79% is controlled by California purchasers, according to the audit. It takes an 80% voting block to make decisions.

Auditors said the Intermountain Power Agency is reaping substantial public benefit and contributes to Millard County’s tax base, but not without excessive disputes. The auditor pointed out the plant has appealed its county tax assessment 26 of 38 years. The plant is operated by the agency via the Los Angeles Department of Water and Power.

The operational structure, tax breaks and the plant’s planned transition to natural gas have all been on the radar of conservative lawmakers for years amid increasing concerns over energy grid security and ensuring Utah preserves existing infrastructure and develops new ways to keep the lights on.

At one point, the Intermountain Power Agency was termed the “600 pound gorilla in the room,” that few wanted to tackle, but as the timer ticks down for the eventual natural gas transition, the issue has gained elevated urgency.

Sponsored by Sen. Derrin Owens, R-Fountain Green, the bill that now resides in the governor’s office for signature would establish a decommissioning authority which would give Utah leaders the opportunity to purchase the assets at the Delta plant, its water rights before the coal units are shelved.

Rep. Carl Albrecht, R-Richfield, the House sponsor, said it is important to maintain an asset already in place for contribution to the energy grid in Utah which has become increasingly strained.

Critics are skeptical the state of Utah could secure the necessary air quality permits given that the current plant is operating under a plan approved with an eye toward the transition to natural gas and abandonment of the use of coal.