In an ongoing effort to reduce power costs from existing PublicUtilities Regulatory Policy Act (PURPA) contracts, Puget SoundEnergy announced yesterday an agreement to buy a 160 MW gas-firedcogeneration plant in Bellingham, WA, from Encogen for $164million. Puget Sound said buying the facility eliminated its secondlargest PURPA contract, a deal which required it to pay Encogenfixed and escalating fees through mid-2008 for the plant’s output.

“This purchase is expected to reduce the net cost of power fromthis co-generation project by approximately 20% annually comparedto the existing contract prices,” said Puget Sound Energy Presidentand CEO William Weaver.

The company, Washington’s largest energy utility serving 900,000electric customers and 555,000 gas customers, reworked its largestPURPA contract, a 12-year deal with Tenaska Washington for outputfrom a 245 MW facility, in December of 1997. The savings on thatcontract were about 20%, said a spokeswoman.

She added that Puget Sound is continuing efforts to restructureits two remaining PURPA contracts. Still in existence are PugetSound’s 123 MW, 13-year deal with Sumas Cogeneration Co. and its13-year contract for 140 MW from the March Point facility inAnacortes, WA.

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