Utah Independent Power informed the Federal Energy Regulatory Commission (FERC) last month that it’s surrendering its preliminary permit to study the feasibility of developing the 800-megawatt Long Canyon Project.
Company president Frank Mazzone told The Times-Independent that the Sonoma, Calif., developer simply could not line up the financing it needed in order to move forward with its plans.
“Basically, it has to do with the economy,” he said Dec. 3. “There is a lot of uncertainty in the overall investment market, and this is one of the casualties that took place.”
Utah Independent Power had been eyeing the possibility of building two dams in Long Canyon southwest of Moab.
As the company envisioned it, the dams would have formed two reservoirs with a total storage capacity of 5,350 acre-feet, or more than 1.8 billion gallons, of Colorado River water.
Water from a lower reservoir would have been pumped to an upper reservoir during evening hours, when demand for electricity is typically low. During peak hours of high-energy demand, it would have flowed back down to the lower reservoir, generating power as it passed through turbines.
Although the company spent more than five years fine-tuning its vision of the project, it never moved beyond the drawing-board phase.
The FERC approved its first application for a preliminary permit in October 2008. However, the agency terminated that permit in May 2011 at the company’s request, according to FERC spokesman Craig Cano.
Utah Independent Power later applied for a new permit, and after the company went through the review process all over again, the FERC approved its second request in September 2012.
Conservationists asked the agency to reconsider that decision, yet the agency ultimately upheld it three months later.
As time wore on, however, the company fell out of compliance with the terms of its preliminary permit.
It was supposed to turn in progress reports every six months. Yet as of late October, the FERC’s Division of Hydropower Licensing said the company had not received the first report, which was due on March 1.
As a result, the agency informed Utah Independent Power that it would likely cancel the permit within 30 days.
Mazzone, in turn, announced that the company would surrender the permit, according to FERC documents filed on Dec. 2.
One of the conservationists who intervened during the preliminary permitting process welcomed the news.
“Wish all our other campaigns were this easy,” Living Rivers Conservation Director John Weisheit said in an email to The Times-Independent.
Although the company’s plans fell through, Mazzone said he believes that another developer might be interested in the project at some point.
“I still think it’s viable and environmentally friendly,” he said. “It was something that we were very bullish on at the time.”
Investors, however, might not share that enthusiasm right now.
Bloomberg New Energy Finance says it’s “almost certain” that annual investment in renewable energy projects and energy-efficient technologies will fall for the second year in a row.
According to the industry researcher and analyst, global investment in such projects was down by 20 percent in the third quarter of 2013 compared to the same period last year. But the drop in the U.S. was an even steeper 41 percent, as more and more investors poured their money into natural gas and shale projects, the company reported.