Opposition against West Wendover’s purchase of the Wendover Gas company and a municipally funded natural gas pipeline is growing despite of a recent study that said both projects were feasible said Wendover, Utah Mayor Mike Crawford.
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“Except for the West Wendover City Council I really don’t think there was all that much support in the first place,” Crawford said Wednesday. “And if you read the report it raises some questions.
The study prepared by Bob Springmeyer of the Bonneville Research Institute suggests that given the right conditions the city of West Wendover could purchase the gas company and operate it at either a profit or at least at the break even point.
Wendover Gas has been in severe economic straights for over a decade primarily according to owner Nancy Green because the major casinos in town opted out of receiving their propane supplied through her companies gas lines and instead went with Wendover Gas’ own wholesaler.
According to the feasibility study West Wendover could purchase the gas company for just under $2.5 million and even without the casinos coming back on the system, the city could operate it without losing money and without raising rates.
“A lot of people, a lot of businessmen are questiong those conclussion,” Crawford said. “My council is against it and even some executives from the casinos are having second thoughts. Wendover Gas is a failing business and we don’t see how the city could run it more efficiently.”
The same reticence is also felt for the proposed natural gas pipeline. While estimated in the feasibility report to cost just over $9 million Wendover has been burned before with overly optomistic projections.
“This kind of reminds me of the compost plant,” the Wendover, Utah Mayor said. “you would think that if there was a profit to be had private enterprise would be building a natural gas line.”
According to energy analyst Paul Kvam one of the largest impediments to a natural gas pipeline to Wendover is not the cost of the project but the increadibly low price for electric power.
“You folks in Wendover live in a whole other world,” he said Tuesday. “the price you pay for electricity is about the lowest in the country.”
A June 2011 survey by the Edison Electric Institute found that the national average rate was 12.07 cents per kilowatt hour. Nevada’s average was 12.16. WREC is well below both marks at just 7.2 cents per kWh.
“The price is so low that residents really have to think long and hard about spending the money to convert to gas,” Kvam said. “And many of them won’t.”
“I am all electric,” Crawford said. “Given the headache and the cost of laying the pipes, getting new gas appliances, ripping out the walls it would be years before the money I would save on gas would break even.”
