Big beef in tiny Sumas

THE TOWN ONCE THRIVED selling gas and groceries to Canadians. Now it is torn over a plan to provide electricity for Seattle's burgeoning suburbs.

SUMAS, Whatcom County - This town is where gas stations come to die.

In two short blocks of downtown, there are five abandoned gas stations with plywood tacked over plate-glass windows that once advertised gasoline, beer and cigarettes to bargain-hunting Canadians.

Sprinkled throughout are shops, restaurants and bars - some closed, others struggling to find something, anything, to breathe new life into a gas-station graveyard.

"Sumas is depressed," says Mayor Don Peterson. "We need an industrial base."

The rather ironic solution favored by Peterson and other town leaders is the Mother of All Gas Stations. Proposed by a Kirkland energy company, a new $400 million Sumas power plant would burn 24 million cubic feet of Canadian natural gas per day to generate power for 400,000 Puget Sound Energy customers in Seattle's Eastside suburbs and beyond.

That plan has triggered a short circuit in local and regional politics - especially north of the border.

Beginning with a state hearing in Sumas tomorrow, opponents will argue that it makes no sense to pump tons of carbon dioxide and other emissions into the air just to keep the electricity flowing in Seattle suburbs 100 miles away. Backers will argue that the gas-fired turbines are the best available option for averting future power shortages.

And that's how this dairy-farming village, which should be worried about milk prices, finds itself embroiled in a debate over a looming energy shortage and the complexities of global warming.

Boom to bust in just a few years

Less than a decade ago, Sumas was a boomtown, fueled almost exclusively by cross-border economics. Lured by low prices, Canadians from the fast-growing Abbotsford area flooded through the small border crossing at the north end of Cherry Street to buy milk, groceries, cigarettes, beer and a tankful of gasoline.

With fewer than 1,000 residents, Sumas in the early '90s had nine modern gas stations with state-of-the-art pumps run by major oil companies. The local grocery sold vast quantities of milk while bars prospered on sales of booze and pull-tab gambling.

"We had three of the top 10 pull-tab operations in the state," says Dick Dickerboom, a Sumas native who runs the Lone Jack Saloon on Cherry Street, the town's main drag.

The bottom dropped out in the mid-1990s.

First came the plummeting Canadian dollar - from 95 U.S. cents to 60 U.S. cents in just a few years. Devaluation ate up much of the difference in costs of beer, groceries and especially gasoline.

"At 60 cents on the dollar, Canadians feel ripped off," Peterson says.

"And I guess I can't blame them."

Meanwhile, Canadian Customs began collecting sales tax for goods brought home by Canadians. And, spurred by free trade, Costco and other discount stores moved into Abbotsford, a one-time farming town fast becoming a distant suburb of Vancouver.

"The Canadians figured out they needed to be more competitive, more price-conscious," says Robert Mitchell, a former Sumas mayor who owns the local drugstore.

"They got down and dirty."

For Sumas, the impacts are nothing short of grim. Five of the nine gas stations went out of business. The town's largest restaurant closed. Two shoe stores are gone, along with one of the town's two grocery stores.

In all, at least 16 businesses have left town since 1995, says Kathy Harvey, the city clerk. "Sales taxes are about one-third of what they were."

At the same time, one business moved into Sumas, the Sumas Energy Plant.

Second energy plant proposed

Built by National Energy Systems Co. (NESCO) of Kirkland in 1993, the plant occupies a couple of acres on the west side of town. It consists of a single combustion turbine - an oversized jet engine that burns natural gas and converts it into electricity.

All this results in an average of 127 megawatts of power, enough to light a city of 80,000 people. The power is sold to Puget Sound Energy, the Bellevue-based private utility that serves much of Western Washington, including Seattle's Eastside suburbs.

This plant, known as Sumas Energy 1, is one of the few power plants added to the Northwest grid in the past 20 years. Earlier this year, the Northwest Power Planning Council warned that the region needs to add up to 3,000 megawatts of power generation or conserve that much to avoid blackouts over the next decade.

For now, at least, gas-burning turbines appear to be the technology of choice, says Chuck Martin, NESCO vice president. They're relatively small, cheap to operate and easy to locate - at least compared with oil- or coal-burning plants. And for now, at least, there is plenty of natural gas to keep them humming.

Four small plants are operating in Whatcom County, and several more are proposed around the region.

Whatcom County is prime territory because it is close enough to tap into Canadian natural gas, and close to major electricity markets in the Puget Sound area.

Now NESCO wants to build another plant in Sumas, across the street. But Sumas Energy 2 would be five times bigger, using two larger turbines and a secondary steam plant to generate 660 megawatts. The two plants combined could power a city almost the size of Seattle.

That plan enjoys the support of most of the Sumas establishment. It would generate 24 full-time jobs, and an average of 200 jobs during two years of construction.

"But the biggest benefit is to our tax base," says Peterson, the mayor.

"Their annual property tax would be about $5 million a year, which means we can improve roads and schools. School-levy taxes would be cut in half. We see this project as a move back toward prosperity."

The project already has encountered flak. Earlier this year, Gov. Gary Locke vetoed a bill that would have exempted the plant from $24 million in state sales taxes. Backers said the company deserved the same break enjoyed by other industries, but Locke said the plant would not generate enough jobs to justify the costs to the state.

The company will try again next year. In the meantime, backers have turned their attention to obtaining the necessary state permits. This month, the local Chamber of Commerce voted to buy newspaper ads aimed at this week's public hearings before the state Energy Facility Site Evaluation Council, or EFSEC. That panel is expected to make a recommendation to the governor this fall.

Trading health for tax revenue?

The efforts aren't likely to sway people like Connie Hoag, the local County Council member who leads the opposition.

She and others argue the plant will generate noise and air pollution while using too much water - 1.2 million gallons per day - to generate steam.

"Essentially this town is proposing to sacrifice people's health to save a little money on school taxes," Hoag argues.

Citing NESCO's environmental-impact report, Hoag reads off the list of potentially harmful emissions: 236 tons per year of nitrous oxide, 101 tons of carbon monoxide, 45 tons of sulphur dioxide, 156 tons of ozone, 223 tons of particulate matter, 136 tons of ammonia. . . .

And 2.4 million tons per year of carbon dioxide, the "greenhouse gas" that is primarily responsible for global warming. That is equivalent to the carbon-dioxide emissions from nearly 500,000 cars driving about 10,000 miles per year.

The natural gas is bad enough, Hoag says. But the company also wants permission to fuel the plant with diesel oil for up to 15 days per year, enabling it to operate if its Canadian gas supply is interrupted.

"The company is doing a fantastic job of propaganda," Hoag says. "They're even running ads saying the plant will be good for salmon."

NESCO and its local backers say the emissions need to be placed in context. Like oil or coal, natural gas is a fossil fuel. It cannot be burned without emissions - particularly carbon dioxide. But natural gas burns cleaner than oil or coal, producing less than half the greenhouse gas. And unlike hydroelectric dams, this plant won't block salmon runs.

What's the alternative?

Eric Hansen, an environmental consultant who worked on the Sumas 2 environmental report, concedes that the 2.4 million tons of carbon dioxide is a significant emission. Compared with hydroelectric dams, a gas-fired plant is "dirty."

But nobody proposes to build more hydro dams; they flood landscapes and block fish migrations. In fact, the debate is over whether to dismantle existing hydro dams.

Hoag and other critics promote solar and wind-generation plants. But neither technology has been developed to the point where it can generate power on a broad scale.

"The region can't afford to plan its energy future based on technology that doesn't exist," argues Mark Funk a NESCO spokesman.

So the appropriate comparison is with oil- or coal-fired plants.

"Nobody can deny that this plant will produce greenhouse gases, and I feel strongly about global warming," Hansen says.

"But if I were dictator, I would say: Tear down those coal plants and build natural-gas plants."

That's why environmentalists support switching cars and buses to natural-gas fuels - not because they are nonpolluting, but because they pollute less.

"The Northwest is looking at a one-in-four risk of energy shortages by the year 2003," says Martin, NESCO president.

"We believe this technology is a reasonable way to fill the gap."

That argument, along with the promise of tax revenue, has swayed most local leaders.

"I've looked at the pollution data, about how our kids will be asthmatic within three years," says Mitchell, the former mayor.

"But the evidence isn't there. These plants are going up all over, and they don't operate that way."

Townspeople are divided over the project. An informal survey by opponents last week counted 67 Sumas residents in favor, 75 opposed and 88 undecided.

"People like Sumas just the way it is," Mayor Peterson observes.

"They don't want to see any change. Nobody here wants to become another Bellevue."

Ultimately, however, the toughest resistance to Sumas Energy 2 may come from north of the border, where local officials and citizen groups are furious over the prospect of pollution blown northward from a U.S. plant.

The Fraser River Valley, a rich delta bisected by the U.S.-Canada border, "will get the worst of it because of the prevailing winds," says Patricia Ross, an Abbotsford City Council member.

"We already have a lot of ammonia in our air from agriculture - cows, chickens, manure. This plant will send another 136 tons of ammonia our way."

The power plant has generated community opposition "unlike any issue I've ever seen," Ross says. "Everybody here is opposed."

So the issue of cross-border economics comes full circle - from gasoline prices to natural gas and power plants. People on one side try to solve a problem, and inadvertently create a problem for people on the other side.

"Doing business along this border is pretty fragile," says Dickerboom, the Sumas saloon operator. "The world just keeps getting smaller."

Ross Anderson's phone message number is 206-464-2061. His e-mail address is randerson@seattletimes.com.