REC Silicon, Grant PUD sign power contract

An exterior view of REC Silicon in Moses Lake. The company asked for a power contract with Grant PUD to guarantee service.

by Herald Staff Writer & Lynne Lynch
| July 2, 2011 3:00 AM

EPHRATA - REC Silicon and Grant County PUD signed a 20-year power sales agreement Wednesday to guarantee service to the Moses Lake company.

The contract can be canceled with one year's notice after five years, said Lon Topaz, of REC Silicon.

The company pays the rates listed in a public rate schedule.

"Certain foreign-owned industrial customers are accustomed to ensuring electrical service via a contract," stated Sarah Morford, a district spokesperson. "REC Silicon is just one industrial customer that has solicited a request for a contract from the utility."

The PUD doesn't have any other contracts with industrial customers, she said.

BMW/SGL Automotive Carbon Fibers requested a power sales contract in the past, but to her knowledge, no one is currently pursuing one, Morford said.

Grant PUD commissioners approved the contract with REC Silicon in a 3-2 vote at their last meeting.

Commissioners Bob Bernd, Terry Brewer and Dale Walker voted in favor of the contract.

Commission President Randy Allred and commissioner Tom Flint voted against the agreement.

Former Grant PUD commissioner Greg Hansen said as a commissioner, he was a "big opponent of any kind of contract for anyone."

"It's just against the public interest to have a contract that gives one rate payer an advantage," Hansen said.

He said no one knows what the power market is going to be like in 20 years.

Hansen viewed the contract as an agreement "for unlimited power."

Walker said he understood the contract could be terminated after five years.

Grant PUD General Manager Tim Culbertson said Walker was correct.

Mike Smith, a Moses Lake contractor, asked if there was a chance the PUD could combine two meters at one company location.

Tony Webb, Grant PUD's assistant general manager, said there were between eight and 10 meters for REC Silicon.

Webb said meter readers can read the meters together and total them. The cost of service and power isn't less, he added.

Allred said Smith and Culbertson were correct, in that today's rates won't affect any monetary situation, but they could.

Smith asked why the district doesn't tell customers in the same rate category as REC Silicon about the opportunity for single metering.

Culbertson said there hasn't been public communication about the matter, but the PUD's Consumer Awareness Group and the Industrial Power Users Group know about the contract.

REC Silicon employees have also been speaking at different forums discussing its need for a contract.

Smith asked if the PUD was not serving REC Silicon enough during nightly power failures.

Culbertson said there have been some issues with service with REC Silicon and with server farms asking for "redundant service," meaning there is some type of backup during a power failure.

He added if they want a higher level of service, they are going to pay for it.

Flint said he has been engaged with REC Silicon and BMW/SGL Automotive Carbon Fibers in power talks.

"They've all wanted to have some kind of assurance of power agreement," Flint said. "It is something they don't have in the U.S."

He is still challenged by the inclusion of two meters for the silane load and the polysilicon load.

He doesn't think a 20-year contract would be wise.

Brewer said remaining customers would be protected because the company has a distinct obligation.

He preferred an earlier version of the contract because it provided assurances to all other customers they would be protected.

It was determined by the district's attorney, Mitch Delabarre, and Culbertson, the section wasn't needed because customer protections are listed in the PUD's customer service policies.

In May, REC Silicon President Tore Torvund told a group of about 100 business people the company was awaiting news on its request for a power sales contract to start another Moses Lake expansion, according to a May 5 Columbia Basin Herald article.

REC Silicon makes solar grade polysilicon, electronic grade polysilicon and silane gas at its Moses Lake and Butte, Mont., plants.

Polysilicon is a key ingredient in making solar panels and is part of computer chips used in MP3 players, flat screen TVs and hybrid electric vehicles.

The company employs about 550 people in Moses Lake, according to its website.