Sacramento's energy provider has decided to pull out of a plan to join forces with other municipal power providers to build a $1.5 billion high- voltage power line from Lassen County to Turlock and the Bay Area.
"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.
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 utility was expected to pay for 35 percent of the project's cost.
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It's not clear whether the 15-member consortium of municipal power providers can make the project pencil out without SMUD. Some of the other members include the Modesto and Turlock irrigation districts.
"We need to look at how this will affect us," Larry Weis, TID general manager and chief executive, said Wednesday evening, adding that the TID's part of the project covered from Tracy to the TID's service area.
MID officials could not be reached for comment Wednesday evening.
The project's stated aims are 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, reaching the Bay Area, Sacramento and Stanislaus County. Officials hoped to finish the project in 2014.
The study phase was expected to stretch into 2012. Nonetheless, the project quickly earned the scorn of property owners and local environmentalists.
Stanislaus County Supervisor Bill O'Brien criticized the project at Tuesday's Board of Supervisors meeting, drawing vigorous applause for landowners upset with the project.
Potential corridors for the project could go through Del Rio, Escalon, Riverbank and Oakdale.
Jon Tremayne, a Ripon resident and part of a local grass-roots effort opposed to the project, welcomed SMUD's announcement.
"SMUD clearly recognizes the fundamental flaws in the TANC power line, TANC (the Transmission Agency of Northern California) tried to sneak this through the public process and they got caught," he said in an e-mail Wednesday evening. "TANC should be ashamed of their effort. At least SMUD is moving to protect their customers from outrageous electricity bills in the future. I hope MID will follow suit to protect my rates."
Study: Search elsewhere
Brinton said SMUD studies suggested that 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 interest 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 is unclear how TANC will pay for the proj- ect without is 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 Brendan Wonnacott, who was just brought on as spokesman for TANC. In the meantime, all public outreach meetings are postponed, Wonnacott said.
Modesto Bee staff writer Kevin Valine contributed to this report.