Community June 28, 2016

Hailey’s Quiet Conductors

POWER Engineers at 40

Making toast is pretty easy. Getting 700 watts to the toaster from a coal plant, a nuclear reactor, a distant wind farm or the photovoltaic array on the roof—that’s trickier.

The task requires a wide variety of engineering talent and sometimes even bat biologists and archeologists who take into account environmental and cultural impacts of building infrastructure. Electrical ions take the path of least resistance, much like water. It’s a wonder that the electricity grid, the dream of inventor Nikola Tesla, has coalesced as much power as it has and delivers it to as many remote places as it does. In the United States the power grid is a remarkably firm system that functions with steady reliability today.

Toast electricity arrives thanks in large part to POWER Engineers, Inc.-—the 40-year experts in grid design best known for stringing high-tension power lines. POWER launched in the Bicentennial year in Pocatello, Idaho, on February 27, 1976. Wide collars and bellbottoms were hip. Blue Öyster Cult laid down power chords for the heavy metal hit “Godzilla” that still rocks the radio waves, and demand for the smooth flow of electricity in the grid was surging. Utah and Wyoming suffered a major blackout on the 200th Fourth of July. Idaho, with smooth transmission of hydroelectricity, avoided the fray. New York City in 1977 succumbed to a major blackout that lead to looting, fires and rioting.

When POWER’s Pocatello headquarters burned down, the founders of the company, including Pete Van Der Meulen, Hans Buhler and Joe Murin, moved the company to Hailey to a building by Friedman Memorial Airport and later to Woodside. The “Burnout” is now an adults-only winter party in honor of the formative event that brought POWER to Hailey. At the beginning, in Pocatello, the crew and their families enjoyed camping and recreatinging together in their free time. In summer, employees with each office (there are 45 worldwide) get together for the “Outage.”

“Employees bring their families, Hailey has rafting and an old-fashioned barbeque. In Boise, we sometimes go rafting or to Eagle Island. There are two parties a year for everybody. POWER sponsors everything,” said Janet Metzger, POWER’s head of corporate communications and one of the company’s newest owners. “In 1997 it got to be where they were taking semis in to the campsite and building dance floors and bridges to get across the creek. It got to be a little too big. It hasn’t stopped, but it’s different since we have multiple offices now.”

North America’s top stringer of high-voltage and acrobatic wire is the Hailey-based company in South Woodside nobody knows about, although Peter Catchpole, now a retired project manager, is famous for stringing cable for record-setting wire walker Nik Wallenda across Horseshoe Falls in 2012 and again in 2013 across a 5,000-foot-deep canyon of the Little Colorado River on indigenous land adjacent Grand Canyon National Park. As can be expected from an engineering company, human safety comes first, so the focus for the daredevil acts was controlling vibrations that could have kicked Wallenda off of his wire. Wallenda has sought to complete a five-mile-long highwire walk between The Empire State Building and The Chrysler Building in Manhattan, but that’s where safety-conscious POWER Engineers and building owners drew the line.

“I went into New York with Nik to look at it,” said POWER’s outgoing CEO Jack Hand who joined the company as a project manager in 1992 and turned over the reins to Bret Moffett in May in time for the annual board meeting when members received “Tales of the Ram,” an anniversary look back at the company. “He’s really into doing these things without safety harnesses. We felt like we got lucky twice.”

It is true that engineers consider wire walks “simple, straightforward” projects because transmission projects pose technical challenges and risks to overcome for consumers, linemen, grid stability and the environment. As the grid morphs and more intermittent sources of power like wind and solar come online, job one is maintaining grid integrity, which often includes voltage compensation with non renewables. Today, grid security challenges include terrorism threats and even electromagnetic disturbances from space. National security officials consider that the grid going down is not a matter of if, but when. All of this poses plenty of new challenges for engineers.

POWER’s first big project, complete with a dramatic helicopter crash, was in 1980—a mile-long string of wires and towers over Kinnikinic Creek for the Salmon Electric Cooperative. Everyone survived the crash and the line still stands.

The anniversary book spills legends of the robust, privately held engineering firm that now has 2,059 employees. Office locations include Minneapolis, Boston, Johannesburg, Nairobi and Helsinki. Gross revenue in 2015 was $395 million. Their revenue from international work was $40 million. Geothermal projects are a big international draw with projects as far flung as Iceland, Costa Rica, South Africa and Turkey. Turkish projects, where POWER is the sole geothermal provider, came out of relationships developed during Gulf War contracts when grid building and repair supplies were trucked in from Turkey, Hand said. POWER has since sold its interest in Iraq to multinationals, as war-zone work, although dramatic, is crushing not only for infrastructure, but for the spirit. The same is true in Afghanistan, where POWER is still active, but transmission lines have had to be continuously rebuilt there, too.

As POWER has advanced, it still only owns one property-—its headquarters in Woodside—but it has acquired a dozen companies, with talent, including 38 former Enron engineers who joined forces with POWER in 2000 after that company’s dramatic fall. Such connections have helped the employee-owned company grow. More than half of its work is direct reward, Hand said. Ownership swings between 10 and 15 percent of staff. There are currently about 300 employee owners. Employees who move to part time or leave the company must sell their shares back. Every year employees are invited to become owners. The current structure was created in 1998 when, under pressure of a pending sale to a British concern, 54 employees, including Hand, scrambled to invest up to $150,000 each to buy out the founders.

“We are engineers. We didn’t have a lot of money,” Hand said. The scrappy company lives up to its icon borrowed from the coloring book of a founding engineer’s daughter and stays focused on what it does best. It has diversified and under Hand’s watch has grown from $28 million to over $400 million since 1998. Weekly, Hand turns down entreaties from big and small firms to sell out. The company’s approach is to stay private and support the work of engineers for the best projects. It’s a system by which an owner can stand to make a good deal of money if he or she stays for the long haul. It’s pretty well known in the electrical engineering field that POWER Engineers is a good place to work because of the way it’s structured, safe from the disruption of mergers and acquisitions.

“Freedom to make choices is powerful. Having the ability to determine your own direction is very cool and fun,” Hand said. “The risks are higher, but the rewards are, too. Our simple philosophy is ‘do good work, have fun and make money.’”

POWER’s first design project to be built was a distribution substation for the Prairie Power Cooperative that was later sold to Idaho Power. Most have traveled by the 24.9 kV distribution substation just west of Fairfield on U.S. Highway 20 without knowing the significance of the small facility on the north side of the highway. It was rebuilt after 35 years in operation, but two beige steel structures with angled legs from the original design are still visible.

Grid capacity has doubled in the company’s 40-year tenure. That expansion has provided great opportunity, especially in the last 20 years since deregulation pumped up demand from utility companies for consultants like POWER to fill in gaps in expertise that downsizing created.

“The United States is a booming economy in our business. It’s the best place in the world to work. You make the most money, and you work with the fairest people,” Hand said. “After we changed management in 1998, we doubled POWER in two or three years and we doubled it again in two or three more, just doing what we do. Occasionally we blew it, but we did it within our means most of the time.”

Worldwide, POWER is responsible for generation of some 160,000 megawatts (MW). That represents power plant electricity that is accessible to consumers at any given moment. The company has diversified and has even gotten involved in the food processing business with offices in Boise, Minnesota and Wisconsin. Revenue in that division has leaped from $1.7 million in 2003 to $40 million today, but 65 percent of  POWER’s business is still power transmission.

Tesla turned 40 in 1896. Idaho POWER has been in business for a century. Conducting through wires, the potential electrical energy of gas, coal, geothermal sources, water and the sun will keep utility companies and engineering firms busy, arguably, forever. For the past eight years POWER has been working with entrepreneur Philip Anschutz to support plans for a 3,000-MW wind power transmission project from a ranch owned by Anschutz in Wyoming—that’s 1,000 wind turbines and 780 miles of powerline designed to connect wind power to the grid south of Las Vegas. The Record of Decision is expected soon with more regulatory and financial hoops to follow, but the project would be the largest of its kind and is expected to take four years to complete, possibly by 2020.

“I believe the real Tesla (not Elon Musk’s car company) would be very proud of where the alternating current concept has evolved to,” Hand said. “He’s truly the father of the modern electric grid.”

This article appears in the Summer 2016 Issue of Sun Valley Magazine.