The Sierra Club lodged the only objection Wednesday to a settlement agreement that, if approved by state utility regulators, would allow Rocky Mountain Power to raise the amount it charges its customers for electricity by $117 million a year beginning in September.

At issue for the environmental organization is millions of dollars that the utility spent on new emission-control equipment for its coal-fired plants — money that the settlement agreement will allow the company to recover from its customers.

"We like that they have taken steps to reduce pollution," said Gloria Smith, a senior attorney for the Sierra Club who was in Utah to present concerns to the Public Service Commission (PSC). "But what we want them to do is verify spending that money [on their old coal-fired plants] was the best option for ratepayers."

The PSC, which took Wednesday's testimony under advisement and will hear from the public next week, is expected to rule by September 21 on whether the case settlement is in ratepayers' interest.

The Sierra Club isn't convinced Rocky Mountain Power adequately analyzed alternatives to investing in its coal-fired plants — alternatives that include decommissioning some of those facilities or retooling them to burn a more environmentally friendly fuel.

Smith said that even though the utility has invested millions in emission-control equipment, it faces the prospect it will have to spend billions more, depending on future government regulations.

Through a consultant, the Sierra Club had explained in written testimony presented to the PSC earlier this year why that might be a problem.

William Steinhurst, with Synapse Energy Economics in Vermont, said Rocky Mountain Power's investment in its coal-fired plants may fall short of what's needed to comply with state and federal environmental rules that might be enacted down the road.

"Under such a scenario, Rocky Mountain Power would be forced to either reinvest in different or additional technology, which could render the proposed investments redundant or obsolete, or to decommission plants entirely, in which case the ratepayer-funded investments would be abandoned," he wrote.

A spokesman for Rocky Mountain Power, Dave Eskelsen, countered during a break in the hearing that all the company's plants are compliant and that it is committed to ensuring they remain so. "All of the environmental costs that are part of this rate case are prudent."

The company is counting on the Public Service Commission to approve the deal in order to avoid lengthy and costly hearings. The settlement agreement has the support of the Committee of Consumer Services, which represents the interest of residential customers and the owners of small businesses in utility rate cases; the state's Division of Public Utilities, which works to ensure rates are fair for utilities and consumers; and industrial energy users. If approved, the settlement would raise the typical Utah homeowner's residential electricity bill by around $3.20 a month.

When it filed its rate-increase request in January, the utility was asking to increase its rates by more than $232 million, it largest request ever, but eventually agreed to the lower figure.

steve@sltrib.com

Twitter: @OberbeckBiz —

Give your opinion

The Public Service Commission wants to hear from the public.

Public meeting • "Public Witness Day," 5 p.m. Monday in Room 403 of the Heber M. Wells Building, 160 E. 300 South, in Salt Lake City.

Written comments • Public Service Commission, Fourth Floor, Heber M. Wells Building, 160 E. 300 South, Salt Lake City, UT 84111.

Email • tbehr@utah.gov.