PORT ANGELES — The Utility Advisory Committee has unanimously recommended the sale of a hydroelectric plant along Morse Creek that has been shut down since April 2012.

The committee recommended Tuesday that the City Council declare the facility surplus and sell it.

City officials are considering an offer from a private company to buy the city-owned facility, which straddles Morse Creek about 5 miles south of where the creek passes under U.S. Highway 101.

Craig Fulton, city public works and utilities director, said the company specializes in alternative sources of energy and intends to produce electricity with the Morse Creek facility.

“They’re looking to generate power,” Fulton told committee members.

Sissi Bruch, committee member and city councilwoman, asked why the city could not do the same.

Fulton said a private company would have different financial concerns.

“My point is, does the city want to be in the power-generating business? I don’t,” Fulton said.

“I prefer to get out of the generation business and be in the transmission and distribution business.”

The small dam had historically produced about 0.3 percent of the city’s total power usage until it was shut down after a key piece of machinery failed.

Phil Lusk, the city’s deputy director of power and telecommunication systems, said Wednesday that city staff decline to comment on details of the offer.

“It would be an offer that would actually put a small amount of money back in the city’s pocket rather than cost us,” he said.

The value of the Morse Creek property also must be assessed before a potential sale, Fulton said.

He said city staff plan to bring the surplus and sale proposal for full City Council consideration at a council meeting in August.

“We still have a lot of work to do,” Fulton said.

“A lot more investigation and research before this comes to any kind of conclusion.”

He told committee members a possible sale would avoid the expense of repairing or removing the facility.

“The point of the sale is to get rid of that risk,” he said.

Fulton told committee members Tuesday that the company also is interested in acquiring the Federal Energy Regulatory Commission license and water rights the city holds for the plant.

Committee member Paul Elliot said he thought it would be a good move for the city to hold on to the water rights associated with the facility.

The rights allow the city to use the water only for power generation and, if an emergency arises, for public consumption, Fulton said.

Committee members directed city staff to gather more information on what transferring these water rights would mean for the city.

Committee members also wanted review of a possible sale by the city’s Real Estate Committee, which consists of Mayor Dan Di Guilio and Councilmen Dan Gase and Lee Whetham.

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Reporter Jeremy Schwartz can be reached at 360-452-2345, ext. 5074, or at jschwartz@peninsuladailynews.com.