San Miguel Power Association, Inc. was established in 1938 for the purpose of supplying central station power to the rural farms and dwellings in the San Miguel Basin area, after these same people were denied service by Western Colorado Power.
Unreliable, intermittent and the refusal of electric service were not uncommon for rural areas in the early 1900's. Under President Franklin Delano Roosevelt, the Rural Electrification Administration (REA) was established to combat these issues. SMPA went into loan negotiations with REA which resulted in a $5 membership fee for the citizens of Nucla, CO. The first membership was purchased by George Wilson, who went on to serve on the SMPA Board of Directors as the Secretary for almost two decades.
As a newly formed rural electric cooperative, SMPA confronted many obstacles. Western Colorado Power, SMPA's power provider at that time, sold limited amounts of electricity to the coop - only 90 kilowatts. Today, that would power just three all electric homes. By 1950, Western Colorado Power finally agreed to sell SMPA all the power it needed to serve their members and the two large mills in the area that were processing uranium and vanadium.
Times were tough for Western Colorado Power however, and the company struggled with tremendous maintenance problems because of their rugged mountain territory. Many times, the company was unable to provide enough energy for SMPA. This opened the door for a new power producer - Colorado Ute Electric Association. They constructed new generation plants in the San Miguel Basin area.
By 1972, Western Colorado Power had reached a low point and eventually merged with Utah Power and Light. Stipulations in the merger forced Utah Power and Light to sell parts of Western Colorado Power's territory. SMPA purchased the areas around Telluride, Rico, Ouray, Silverton, Ridgway and Colona. These areas included some of the most rugged and hazardous country in the United States. From the start, SMPA worked to upgrade the poorly maintained mountain lines to improve reliability to their members.
It was business as usual until 1992, when Colorado Ute claimed bankruptcy. The company was then acquired by Tri-State Generation and Transmission, who took control of all of Colorado Ute's major assets including the lease of Craig Power Station Unit 3 and the 100-megawatt Nucla Power Station. Approximately, 675 former Colorado Ute employees and 10 new member systems joined the Tri-State association. SMPA was one of these member systems and still is today.