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Sierra Pacific Industries suspends operations at Loyalton power plant

Delaine Fragnoli
Managing Editor
8/25/2010


Sierra Pacific Industries announced Aug. 20 that it is suspending operations at its Loyalton power plant effective immediately. The plant's 15 operators who will be directly affected by this closure were notified the same day.

The company has also notified Nevada Energy, which purchases the energy produced by the plant, of the closure.

This is the second closure of the co-generation plant is less than a year. The company closed the plant in October 2009 and laid off 22 workers.

At that time, SPI said the cost of fuel was more than it received for the electricity the plant generated. Spokesman Mark Pawlicki said most of the plant's fuel came from landfills in the Sacramento area and the cost of trucking it to Loyalton was not cost effective.

Citing resolved contractual issues with its power purchaser, SPI reopened the co-gen plant, also called a biomass electrical power plant, in January 2010.

In a press statement about the latest closure the company said Nevada Energy recently lowered the rates it pays to SPI for electricity generated from the Loyalton plant.

SPI also blamed "numerous government decisions," including failure to implement the Quincy Library Group program of work, which "have cut off ... feasible fuel supplies" and litigation by environmental groups.

"The combination of uncertain fuel supplies and reduced energy rates made the facility uneconomic to run," said SPI.

Despite the seesaw status of the Loyalton plant, the company said it was still exploring options that might allow it to reopen the facility.
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