More News About the Pueblo CO Powerhouse:

from the DENVER ROCKY MOUNTAIN NEWS:

Xcel to use union labor on coal plant
It agrees to terms after year of negotiations in Pueblo

By Gargi Chakrabarty, Rocky Mountain News
June 9, 2005

Xcel Energy Inc. has agreed to use only labor working under union wage rates and conditions to build its proposed $1.35 billion coal-fired power plant in Pueblo.

Xcel reached the agreement with labor unions - after pressure from Pueblo's City Council in an area where unions are strong - late Tuesday after a year of negotiation. The utility has agreed to show preference for local workers even when a contractor is based out of state, promising hundreds of jobs to the Pueblo area in the next few years. At the peak of construction, the plant is likely to employ about 1,000 workers.

In exchange, the unions have promised there won't be any strikes or lockouts at the plant and that Xcel has the right to manage the project and hire its own contractors.

Construction is expected to start this fall and be complete in 2009. State utility regulators have approved the plant, and a hearing on air quality permits is scheduled for today.

The facility, to be built on Xcel's existing Comanche power plant site, would be funded by Xcel's 1.2 million ratepayers in Colorado. If regulators approve, a rate increase to pay for the construction could show up as early as Jan. 1, 2007, on customer bills.

"We agreed to direct a general contractor to hire 100 percent union labor," Xcel spokesman Mark Stutz said. "Anybody who works in the plant, either union or nonunion, has to come through the union shop."

Neal Hall, business manager for the Colorado Building Construction Trades Council, which spearheaded the negotiation on behalf of labor unions, said it was a "historic agreement."

The council, an arm of the AFL-CIO, has 31 local craft unions, which represent 15 national and international unions. The council represents about 30,000 workers in Colorado.

In the past year, Xcel had made various offers to the council, including one in which it proposed to use 60 percent union labor - a proposal roundly rejected by some unions.

Hall gave credit not only to Xcel but also to the Pueblo City Council for helping reach Tuesday's agreement.

"The City Council never gave up on their goal of ensuring good, safe, and decent-paying jobs for the Pueblo community," Hall said. "An all-union project means one that protects not only the economic but also the physical safety of the workers and will provide many apprenticeship and training opportunities." 

Hall said the apprenticeship programs of some local unions, which have worked closely with Pueblo schools in past years, will benefit from the agreement.

But Xcel's Stutz cautioned that the utility still has to resolve some outstanding issues - such as the plant's annexation to Pueblo and purchase of water rights - before it can move forward with the proposed 750-megawatt project.

Intermountain Rural Electric Association would own 190 megawatts, or 25 percent of the project, and Holy Cross Electric Co. would own 60 megawatts, or 8 percent. The remaining 500 megawatts, or 67 percent, would be owned by Xcel, which would operate the plant. One megawatt serves the average electricity needs of roughly 1,000 homes.

Xcel is pursuing the plant's annexation to the city because Pueblo wants to use tax proceeds from the plant to finance construction of a new police building and other projects. The property is outside the city limits.

Annexation also would help Xcel purchase about 5,500 acre-feet of water for the plant from the Pueblo Board of Water Works. The purchase would be in addition to the 9,000 acre-feet of water Xcel buys for a 660-megawatt power plant on adjacent property.


chakrabartyg@RockyMountainNews.com or 303-892-2976

from the PUEBLO [COLORADO] CHIEFTAN:

Labor unions, Xcel Energy reach pact, more hurdles remain
By JAMES AMOS and JOHN NORTON
THE PUEBLO CHIEFTAIN
All construction work done on Xcel Energy's new generating unit here will be done by union labor, with preference given to local workers.

That was the deal worked out between the company and the Colorado Building Trades Council this week, clearing another hurdle as the company moves closer to beginning work on the $1.1 billion project.

The council represents 23 unions across the state including carpenters, laborers and others.

Xcel wants to add a third, 750-megawatt coal-fired generator at its Comanche Station just east of Rocky Mountain Steel Mills.

The project is expected to generate about 1,000 construction jobs and the agreement with the unions calls for preference to be shown to local workers even if contractors are based out of the state.

Neal Hall, business manager of the council, said that the pact will protect Pueblo from an influx of workers from out of state or foreign countries and offer a chance for more young people to enter union apprenticeship programs.

The agreement bans strikes and lockouts and Mary Fisher, vice president, Colorado Resource Development for Xcel, said that even though Xcel's cost for the job is confidential, the deal will not jeopardize its standing in Xcel's least-cost plan for power generation.

Hall gave credit to Xcel and to the Pueblo City Council and area political leaders for applying pressure on Xcel. “The City Council never gave up on their goal of insuring good, safe, and decent-paying jobs for the Pueblo community," Hall said.

By supporting the efforts of the parties - both Xcel and the Building Trades Council - to work through this difficult negotiating process, the City Council has shown its commitment to the working men and women and, importantly, the young people of Pueblo seeking a career in construction.

Fisher said she hoped that work on the project would get under way by late summer or early fall if other issues are settled quickly.

Those other issues include working out an agreeable price for water from the Pueblo Board of Water Works and annexing the Comanche property to the city, something that can affect the water price.

The annexation process is scheduled to start Monday night when City Council will receive six petitions for the change.

City Manager Dave Galli said four of the annexation petitions will be submitted by Rocky Mountain Steel whose property separates the Comanche plant from the city. The petitions will offer a 120-foot strip of vacant land between the current city limits and Xcel's land for annexation.

The remaining two petitions will be submitted by Xcel for the Comanche power plant, Galli said.

The annexation has to be done in stages because state law requires that at least one-sixth of the boundary of the land being considered for annexation touch city limits.

The city's past annexation of land for a private prison at the airport industrial park also was done in stages.

The petitions will go to the city's Planning and Zoning Commission for approval, Galli said. If they are approved, the annexation petitions will go to City Council for final approval.

That could happen in late August or early September, he said.

The city is still negotiating the annexation agreement with Xcel, Galli said.

"We're hoping those details will be worked out by the end of this month," he said.

But being able to annex the steel mill land was crucial to the deal, according to Galli.

"We appreciate how cooperative Rocky Mountain Steel was to make the Xcel annexation possible," he said.

City Council member Gilbert "Bo" Ortiz, who was elected with the support of organized labor, said he didn't think labor was ever a major issue in the negotiations.

The deals with the city and water works are complex ones that include an up-front payment of $17 million to the city of Pueblo in return for a break on future property taxes. The city plans to use that money for a new police headquarters and other public buildings.

"We still have outstanding issues and the city and Xcel are still in negotiations," Ortiz said.

In addition to water and land issues, the company also must get a permit from the Colorado Department of Public Health and Environment that will allow it to burn more coal.

Xcel, which claims that its plan to clean up its two existing units will mean a net reduction in some pollutants, does not expect to face much local opposition. Area environmental groups reached a settlement with the company earlier this year, promising not to oppose the air permit in return for other measures Xcel pledged to take.

Other groups are expected to protest the permit and will probably attend a public hearing scheduled for 6 p.m. today at the Sangre de Cristo Arts and Conference Center.