Archive for Wednesday, February 28, 2001

Electric company eyes area for plant

February 28, 2001

A $200 million electricity generating plant could be on the horizon for Leavenworth County.

Gary Carlson, executive director of Leavenworth Area Development, said that since July he has been working with a "prospect" that is interested in building a power plant, powered by natural gas.

"In terms of a site selection, I don't think they've made a decision yet," Carlson said.

A source who wished to remain unidentified said he believed the site is near Jarbalo, about five miles north of Tonganoxie.

Carlson said three or four locations had been considered, but he declined to comment if the sites were in Leavenworth County.

"You have to be close to a KP&L trunk system," Carlson said. "If you've got something, you've got to have a place to plug it in. I think KP&L and Leavenworth Jefferson Electric Cooperative have substations. We've got quite a few in this area, it doesn't have to be humongous substations can be two, three or four miles apart."

When specifically asked about Jarbalo as a location, Carlson said: "Jarbalo? Could be, I'm sure they have a substation out there somewhere."

State Sen. Bob Lyon, R-Winchester, said that he had recently received an e-mail from a resident of Leavenworth regarding a possible new power plant.

"They didn't give me any details," Lyon said. "But it said there had been some interest expressed in an electrical generation facility in this neck of the woods. He made it sound like it was in Leavenworth County somewhere."

Carlson declined to name the utility company.

"It's not up to me to tell you that," Carlson said. "When they want to make an announcement, that's their decision."

County Commissioner Don Navinsky, who had attended Thursday's LAD meeting, said he didn't know what locations were being eyed, or the name of the electrical utility.

"He (Carlson) didn't mention a particular area," Navinsky said. "I don't know, I don't have a clue."

Navinsky said Carlson's announcement was news to him.

"Yesterday was the first I'd heard of it," Navinsky said on Friday. "I was pleasantly surprised at what he said."

The news would be good for the county, Navinsky said.

"What it also means is we maybe wouldn't have the situation that California's in right now," Navinsky said. "It would always be nice to have a power plant or a generation facility close by."

Carlson said it has been difficult to draw electricity production plants to Kansas, because of property taxes.

"We tax utilities at 33 cents on the dollar value," Carlson said. " If it depended on property taxes, we would be the last to be selected. Missouri is better by far than we are."

Missouri taxes utilities at 23 percent, he said.

Lyon said the utility tax rate can't be changed without a constitutional amendment, but said there is a move in the state Senate that would reclassify new power plants to reduce the tax rate.

"There's a different category of power plants called merchant power plants," Lyon said. "The proposal is to tax them at the industrial rate of 25 percent to encourage new production."

The bill has been referred to the Senate tax committee, Lyon said.

"They'll take a look at it and if they pass it out of there, there's still the possibility of the senate acting on it as a whole this session," Lyon said.

Rep. Ken Wilk, R-Lansing, noted recent increases in power demands.

"Over the last eight years, there's been approximately a 25 percent greater demand nationally for electricity and there's been a six percent reduction in the supply side," Wilk said. "One doesn't have to be a rocket scientist to figure out that doesn't work."

Lyon said the trend toward deregulation of utilities makes it all the more important for Kansas to have adequate power sources.

"What's happened is as we move more and more toward deregulation, we're going to rely more an more on independent power producers," Lyon said. "Unless we get more of them in Kansas, we're going to have problems."

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