Utilities votes to close Navajo coal plant at end of 2019

Posted at 10:14 PM, Feb 13, 2017
and last updated 2017-02-14 00:14:32-05

The owners of a coal-fired power plant in northern Arizona decided Monday to close the plant when their lease expires in December 2019.

The Navajo Generating Station's operator, the Salt River Project, had said closing the three-unit, 2,250-megawatt plant near the Arizona-Utah line was a possibility because less expensive power generated by burning natural gas is available.

SRP Deputy General Manager Mike Hummel said the utility company "has an obligation to provide low-cost service to our more than 1 million customers and the higher cost of operating NGS would be borne by our customers."

SRP is one of the plant's owners, along with Tucson Electric Power Co., Arizona Public Service Co., Nevada-based NV Energy and the U.S. Bureau of Reclamation.

The owners' focus now is to secure an agreement with the Navajo Nation that would allow the plant to continue to run through the end of its lease on Dec. 22, 2019, and allow removal and restoration activities, which could take up to two years, Hummel said.

Without an agreement between the owners and the Navajo Nation, Hummel said the plant would be required to cease operations later this year.

Navajo Nation President Russell Begaye said the tribe had proposed to keep the generating station in operation until at least 2030 and now wants help from the White House.

"We ask the Trump Administration to step in and see that NGS plant operations continue through 2044," Begaye said in a statement. "Many people depend on this industry."

However, Navajo Nation Council LoRenzo Bates called the plant owners' decision "the first step in the right direction for all stakeholders."

He said SRP and the other utilities should continue working with tribal leaders to develop long-term solutions that take into account the potential loss of revenue and jobs and the economic impact that a shutdown would have on the entire state in 2019.

"We are very concerned about the workforce -- the hundreds of Navajo families that make a living from NGS and the many more jobs and revenues that are created from secondary markets," Bates said in a statement.

The closure reportedly will affect about 500 workers at the plant located near Page and another 325 at the Kayenta Mine 80 miles away, which straddles the Navajo and Hopi reservations and has nowhere else to sell its coal.