Sacramento's energy provider has decided to pull out of a plan to join forces with a collection of other municipal power providers to build a $1.5 billion high-voltage power line from the Valley to Lassen County.
"We feel the overall project isn't strong enough to justify spending additional money on scoping and planning," said Elisabeth Brinton, a Sacramento Municipal Utility District spokeswoman.
To date, SMUD has spent $2 million of the $13 million it was expecting to spend investigating the project.
SMUD's withdrawal leaves a gaping hole in the project's budget. As the largest player, the publicly owned Sacramento utility was expected to pay for 35 percent of the project's cost.
It was not immediately clear whether the 15-member consortium of municipal power providers can make the project financially feasible without SMUD. Some of the other consortium members include the cities of Roseville and Redding and the Modesto Irrigation District.
The project's stated aim is to increase the region's power-grid capacity, improve reliability and help move power generated by future clean energy projects in the remote northeast corner of the state to power-thirsty urban areas.
The 600 miles of high-voltage lines would run from the northeast corner of the state to the San Francisco Bay Area, Sacramento and Modesto. Officials hoped to finish the project in 2014.
The study phase was expected to stretch into 2012, but the project quickly earned the scorn of property owners and local environmentalists.
Brinton said SMUD said studies suggested the utility should search elsewhere for the green energy it will need to meet future renewable energy requirements expected to reach 33 percent by 2020.
"We have concluded it might not be in the best interests of our customers," Brinton said. "We want to step back and analyze all the options."
Nora Shimoda, a Davis resident who helped galvanize opposition to the project, said she was glad SMUD showed some "good judgment."
"They seem to be a reasonable board," Shimoda said. "We do support green energy. We just did not think that (this project) made sense."
While it was unclear how the Transmission Agency of Northern California would pay for the project without its biggest partner, officials said the project is not dead.
"We just got this notification, and we are going to be meeting with our partners to assess our next steps," said TANC spokesman Brendan Wonnacott. In the meantime, all public outreach meetings have been postponed, Wonnacott said.
Rockney Compton, a Round Mountain resident who might have a set of power lines over his backyard, responded to the news with guarded optimism.
"I'm not going to hang up my hat until it's certain it's history," Compton said.
Call The Bee's Ed Fletcher, (916) 321-1269.
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