NOTE 3 – PROPERTY, PLANT AND EQUIPMENT

Our property, plant and equipment consist of electric plant and other plant. Both of these are discussed below and are included on our consolidated statements of financial position.

ELECTRIC PLANT: Our investment in electric plant and the related annual rates of depreciation or amortization calculated using the straight‑line method are as follows (dollars in thousands):


						December 31,		December 31,
	Annual Depreciation Rate					2017		2016
Generation plant	0.89	%	to	6.27	%	$	3,558,369	$	3,542,578
Transmission plant	1.11	%	to	2.09	%		1,496,362		1,407,846
General plant	1.46	%	to	9.53	%		484,022		461,148
Other	2.75	%	to	10.00	%		264,091		271,041
Electric plant in service (at cost)							5,802,844		5,682,613
Construction work in progress							175,567		212,081
Less allowances for depreciation and amortization							(2,409,020)		(2,361,555)
Electric plant						$	3,569,391	$	3,533,139

At December 31, 2017, we had $49.8 million of commitments to complete construction projects, of which approximately $48.5, $0.8 and $0.5 million are expected to be incurred in 2018, 2019 and 2020, respectively.

On September 1, 2016, we announced that the owners of Craig Station Unit 1 reached an agreement with the Colorado Department of Public Health and Environment, U.S. Environmental Protection Agency, WildEarth Guardians and the National Parks Conservation Association to revise the Colorado Visibility and Regional Haze State Implementation Plan (“SIP”). Under the proposed revision to the SIP, the owners of Craig Station Unit 1 intend to retire Craig Station Unit 1 by December 31, 2025. The retirement date was previously estimated to be December 31, 2051. We are the operator of Craig Station and own 24 percent of Craig Station Unit 1. Craig Station Unit 2 and Unit 3 will continue to operate. Our share of Craig Station Unit 1 is 102 megawatts with a net book value of $26.9 million as of December 31, 2017. The shortened life increased annual depreciation expense in the amount of $2.9 million.

As part of the above mentioned agreement on proposed revisions to the SIP, we intend to retire the Nucla Generating Station by December 31, 2022. The retirement date was previously estimated to be December 31, 2049. We are the operator and sole owner of Nucla Generating Station with a net book value of $55.2 million as of December 31, 2017. The shortened life increased annual depreciation expense in the amount of $8.8 million.

Effective January 1, 2017, we adopted depreciation rates that reflect rates determined in a depreciation rate study for our transmission plant and most of our general plant, which decreased depreciation expense $14.2 million. A depreciation rate study was completed during 2017 for our generation plant and these rates were adopted beginning on July 1, 2017, which increased depreciation expense $0.7 million.

JOINTLY OWNED FACILITIES: Our share in each jointly owned facility is as follows as of December 31, 2017 (these electric plant in service, accumulated depreciation and construction work in progress amounts are included in the electric plant table above) (dollars in thousands):


			Electric				Construction
	Tri-State		Plant in		Accumulated		Work In
	Share		Service		Depreciation		Progress
Yampa Project - Craig Generating Station Units 1 and 2	24.00	%	$	396,395	$	237,467	$	4,792
MBPP - Laramie River Station	24.13	%		415,071		299,753		25,917
San Juan Project – San Juan Unit 3 (1)	8.20	%		—		—		—
Total			$	811,466	$	537,220	$	30,709

(1)

Our ownership in the San Juan Project terminated December 31, 2017.

OTHER PLANT: Other plant consists of mine assets (discussed below) and non‑utility assets (which consist of piping and equipment specifically related to providing steam and water from the Escalante Generating Station to a third party for the use in the production of paper).

We own 100 percent of Elk Ridge Mining and Reclamation, LLC (“Elk Ridge”), organized for the purpose of acquiring coal reserves and supplying coal to us, which is the owner and operator of the New Horizon Mine near Nucla, Colorado, which supplies coal to the Nucla Generating Station. New Horizon Mine has ceased coal production and on June 8, 2017 started final reclamation. Elk Ridge also owns Colowyo Coal, which is the owner and operator of the Colowyo Mine, a large surface coal mine near Craig, Colorado. We are currently mining the South Taylor pit and started development on the Collom mining pit in 2017. During 2017, we incurred capital expenditures of $46.8 million related to the Collom mining pit development. We also own a 50 percent undivided ownership in the land and the rights to mine the property known as Fort Union Mine. The expenses related to this coal used by us are included in fuel expense on our consolidated statements of operations.

Other plant assets are as follows (dollars in thousands):


	December 31,		December 31,
	2017		2016
Colowyo Mine assets	$	223,377	$	173,626
New Horizon Mine assets		46,946		47,404
Fort Union Mine assets		846		1,158
Accumulated depreciation and depletion		(99,100)		(83,595)
Net mine assets		172,069		138,593

Non-utility assets		12,377		12,269
Accumulated depreciation		(6,560)		(6,214)
Net non-utility assets		5,817		6,055
Net other plant	$	177,886	$	144,648