Company drops plans for power plant in border Oregon county

February 18, 2007 12:00 am

KLAMATH FALLS, Ore. (AP) — A company that planned a natural gas-fired power plant in Klamath County has pulled the plug on it.

State officials said the owners couldn't sell the electricity.

Officials of the COB Energy Facility and its holding company told the state energy office they were withdrawing applications for air and site permits. The facility was called COB because it was near the California-Oregon border.

The plant was to be built in a rural area, the Langell Valley, near the town of Bonanza, and had divided residents and officials.

"Procedurally, it was a very poor project," said Klamath County Commissioner Bill Brown, an opponent.

Opponents first feared the plant would compete for irrigation water, and then the plant's design was changed so that it would be cooled by air rather than water. Opponents also objected to placing it in a rural area.

The plant's developers had hoped to take advantage of a large natural gas pipeline and high-power electrical transmission lines to export the energy to Western markets.

State officials said the plant could eventually be built, but the licensing process would start from scratch and emission guidelines would be stricter.

"They would have to be pretty confident they'd have a buyer," said Adam Bless, an analyst with the energy department.

He said the plant had gotten an air quality permit, but construction hadn't begun within the 18 months the permit prescribed.

"It became a question of whether the market would materialize," Bless said.

County Commissioner Al Switzer said he had had doubts the plant would actually be built but said it would have been of benefit, including $2.5 million in taxes.

The plant was first developed by Peoples Energy Corp. of Chicago and sold last year to J-Power USA Development, whose parent company is Tokyo-based Electric Power Development.