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January 22, 2004

Mr. Michael Grainey, Administrator
Oregon Office of Energy
625 Marion St. NE, Suite 1
Salem, OR 97301-3742

Shelly Cimon, Chair
Oregon Energy Facility Siting Council
625 Marion Street NE, suite #1
Salem, Oregon 97301-3742

Dear Mr. Grainey and Ms. Cimon:

These are my formal comments on the proposed People’s Energy California Oregon Border (COB) Energy Facility as presented at the public hearing, Thursday, January 22, 2004, Exhibit Hall #2, Klamath County Fair Grounds, 3531 South Sixth Street, Klamath Falls, Oregon:

Good evening, my name is Steve West and I am one of three County Commissioners that make up the Klamath County Board of Commissioners. The Board of Commissioners has not adopted a position on the proposed People’s Energy California Oregon Boarder (COB) Energy Facility. I represent only myself this evening in my capacity as Klamath County Commissioner Position Number 3.

In qualifying my testimony, I have a BA degree in Geography with an emphasis in land-use and natural resource planning. I have worked as a planner as well as twelve (12) years in the investor-owned electric utility business in the Pacific Northwest. Currently I am serving my eighth year as a Klamath County Commissioner.

I have carefully reviewed all three of People’s Energy proposed California Oregon Boarder (COB) Energy Facilities proposals. Evaluating both the positive and negative impacts of this project on the people of Klamath County. The negative impacts far out weigh the positive ones, so my testimony this evening will be against People’s Energy proposed California Oregon Boarder (COB) Energy Facility

Peoples Energy Resources, through their consultant KPMG, has estimated that "the economic impact of construction and operation of the COB Energy Facility is estimated to be $469 million over the first five years and $575 million over the entire 33-year construction and operating period." In the spirit of the old joke about the magnitude of money, "a million dollars here and a million dollars there and pretty soon you are talking about real money". Most would agree that $575 million is real money. Most Klamath County residents would also agree that our local economy could use some help. But there is no such thing as a free lunch, so at what cost will this estimated $575 million come into our local economy?

Initially, it is the people living near the COB Energy Facility who will be most significantly impacted. They will pay the price of having their rural agricultural community significantly disrupted by the construction and operation of this industrial project and its 7 miles of 500KV transmission lines. There will be significant increase in traffic, noise, and visual impacts. There may also be significant negative impacts to air quality, and ground water quality and quantity depending on which if any COB proposal actually gets permitted and built.

It is interesting to note that according to the Herald and News both the Klamath County Chamber of Commerce and Klamath County Economic Development Association (KCEDA) have endorsed the third COB proposal. I wonder how many of the members of those two entities, who voted to support the project, live anywhere near the proposed site? Ultimately, I believe that all the residents of Klamath County will pay the cost of lost agricultural land that is zoned Exclusive Farm Use (EFU) when it is used for industrial purposes.

As I stated earlier, I am not a stranger to energy facilities, having spent twelve years working for an investor owned utility. These types of facilities are necessary for sustainable economic growth. One has only to look at the situation the State of California finds itself in by growing without building energy facilities to support the growth. Because of California’s reluctance to allow energy facilities to be built in their own back yard, companies like Peoples Energy want to build energy facilities to supply California in the neighbor’s back yard, Oregon, and Klamath County.

Energy facilities can be well designed and properly sited on industrial land. A good example of that is the City of Klamath Falls Co-Generation Plant. This energy facility was sited on land that had a long history of industrial use and was zoned for heavy industry. This energy facility is also innovative in the way it is using sewer effluent for cooling, addressing a significant problem of wastewater disposal for the City. One problem however, with the City of Klamath Falls Co-Generation Plant has been the over-promising of financial benefits by enthusiastic supporters. The electric generation business is volatile by nature and there will be up times and down times. Over time, the City of Klamath Falls’ project should make money and benefit the citizens.

Anyway you look at the COB energy facility, it is a heavy industrial land use and therefore should be sited on industrial zoned land, and not on Exclusive Farm Use (EFU) zoned land. This is the same argument I made last year in voting against Masami Foods’ application to site an industrial plant on EFU zoned land. Industrial use, be it a hog factory or an energy facility is not an appropriate use for land zoned EFU.

I also have significant concerns regarding the negative impacts this project would have on Klamath County roads. The Klamath County roads that this project would utilize for the construction and operation are essentially farm to market roads. A retired Klamath County Public Works Director, who has extensive first hand knowledge of these roads, assures me that they were not constructed to a standard that would facilitate their use for the construction and operation of a industrial facility the magnitude of the proposed COB project. These roads are deficient from the standpoint of lane width, load capacity, and daily vehicle count to support this proposed project.

These concerns should build a strong case against siting an industrial facility of the magnitude of the proposed COB on land zoned Exclusive Farm Use (EFU). The State of Oregon has a proud history of being a leader in land-use planning. Land use planning and the resulting zoning take into consideration impacts to surrounding landowners including devaluation of property value, impacts from increased traffic and congestion, and also impacts on infrastructure. The very reason that Oregon is a leader in land-use planning and zoning laws is to assure that developments are sited on appropriately zoned land.

Oregon’s energy facilities siting procedure allows an applicant to "op-out" of the local jurisdiction for land use permitting and instead deal with the State of Oregon. This is serious flaw in Oregon law that effectively takes the local jurisdiction out of the process. To the best of my knowledge, this is the only industrial land use that gets to make that choice.

People’s Energy has chosen to take the State of Oregon route. How can a company like People’s Energy on one hand say they want to be a good corporate citizen, while at the same time say that they don’t want to go through the local land use permitting process? Why are they afraid of local decisions? The Oregon Energy Facility Siting Council will be making a tragic mistake if it permits this heavy industrial facility to be sited on land zoned EFU, in a rural community with a road system that was never built to handle that magnitude of impact. It would also be an insult to Oregon land-use planning.

Am I opposed to the siting of an electric generation facility anywhere in Klamath County? Certainly not, as I have already said, energy facilities can be well-planned and built on industrial zoned land. My testimony tonight might be different if Peoples Energy were proposing an energy facility on industrial zoned land and had the support of the people who were going to be directly impacted.

When Peoples Energy first proposed that this energy facility be built on EFU land they cited the necessity of the availability of large quantities of ground water for cooling. Their third proposal, the one that is currently being reviewed, is for an air-cooled energy facility. By their own proposal they no longer require large quantities of ground water, so why can this energy facility not be moved to a location that is appropriately zoned for heavy industrial use? Peoples Energy will tell you that they have already invested too much money to look at another site. But from the information they have made public their investment to date is only 2-3% of the total project. Is 2-3% too much to get it right the first time?

I certainly hope that this energy facility is not permitted as proposed, but if it is then at the very least the Oregon Energy Facilities Siting Council must impose conditions on People’s Energy that give the people who are directly impacted and Klamath County infrastructure adequate safeguards. Some of those conditions must include an escrow account or bonding of sufficient amount that could be used to pay for impacts to local residents and Klamath County infrastructure. This would include the identifying and requiring that exclusive routes be used for heavy construction equipment, vehicles, and materials. The escrow or bonding account would pay for the repair of these roads.

Peoples Power should also be required to provide mass transportation, like buses, for all construction employees to minimize the impacts of additional traffic on rural Klamath County roads. This would also help reduce construction traffic that might negatively impact normal activities associated with agriculture such as moving livestock, farm equipment, and farm products to market. This would also help mitigate the negative impact of increase traffic on children going to and from school.

Ultimately however, the authority to site the COB project or any electric generation facilities lies with the Oregon Energy Facilities Siting Council. The majority of any testimony you hear this evening in support of this energy facility will come from people who are not directly impacted by it. People who live nowhere near the proposed location. It is easy to be for something if it does not come at any cost to you, if it does not impact you personally.

My hope is that you listen especially close to the people who are actually going to be impacted. These are the people whose families, homes, lives, and way of life is going to be directly impacted by this energy facility. Do the right thing and tell People’s Energy that if you build an industrial facility in Oregon, you are going to build it on land zoned for heavy industry, not farm land. Better yet, tell Peoples Energy of Chicago that Oregon and Oregonians are not going to become California’s energy farm. Tell them that if they want to sell energy to California then they are going to have to build the energy facility in California. Thank you for your time. I would be happy to answer any questions you might have.





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