ARPA Bringing Lawsuit Against Light Plant Boiler Manufacturer

ARPA

ARPA, Arkansas River Power Authority, is going back to court.  The utility company filed to bring a lawsuit against the boiler manufacturer used in the Lamar Repowering Project.  Babcock & Wilcox, according to a news release from ARPA, “has failed to deliver a fully functioning Boiler for the Lamar Repowering Project and failed to meet the requirements of its contract, the ARPA Board of Directors Authorized its legal counsel, Fairfield and Woods, to initiate litigation against B & W.”  The ARPA statement claims that as a result of the manufacturer’s inability to deliver a fully functioning boiler, ARPA has been unable to operate the project and has incurred substantial losses.  The litigation is expected to be filed in the U.S. District Court within the next few weeks. 

Lamar Light Plant Repowering Project, East View

Lamar Light Plant Repowering Project, East View

The Lamar Repowering Project was put on hold two years ago when it was determined that the operation of the current B & W boiler would not be able to produce sufficient power to keep the Light Plant online without exceeding emissions stipulated in the plant’s air quality permit.  It had been hoped that modifications made to the boiler would allow it to function at its expected levels, but one sticking point between ARPA and the manufacturer was the financial responsibilities for materials and testing.  Lamar Light Plant Superintendent, Houssin Hourieh, explained months ago that in order to conduct the tests, additional employees would need to be hired, and sufficient amounts of coal would need to be purchased and delivered to the Lamar site in order to operate the plant for test runs.  In the interim, ARPA has made arrangements to purchase electric power from outside sources until 2023. 

Houssin said B & W didn’t bring anything new to the table regarding any potential mediation between the two entities last month, and with that in mind, ARPA board members decided on January 30 to pass a resolution to file a lawsuit.  The light plant superintendent said that any plans Babcock & Wilcox had to test their equipment modifications this coming summer won’t be realized at this point. 

The Lamar Utility Board meeting on February 11 showed during their financial report that sales of electricity at the light plant through January are down 5% compared to the same period last year.  Residential sales were off 3.8% and commercial/industrial sales were down 5.7%.  These two customer classes represent an estimated 95% of total sales for the month and revenue is down 1% during this time frame.

By Russ Baldwin

Brought to you by: Colorado East Bank & Trust

Filed Under: BusinesscommunityEconomyEnergyFeaturedHot TopicsLamarProwers CountyUtilities

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