Mine employees and officials talk about the possible closure of the Kayenta Mine. Mark Henle/azcentral.com
Large transmission lines used to move electricity from the Navajo Generating Station could be a major advantage for developing solar or wind projects in the Four Corners region should the coal plant close, energy experts said Tuesday.
The coal plant near Page could close as early as this year or stay open through 2019, when the current owners have said they will no longer operate it. There is a remote chance new buyers could run the plant beyond then, but so far no proposal along those lines has been made public.
When the 2,250-megawatt coal plant shuts down, it will leave major power lines in the region underused, and utilities that own the lines would have the opportunity to take power from renewable-energy projects that could be built in the area, officials said.
“This is clearly a historic opportunity,” said Jessie Audette Muniz, senior director of project development for Apex Clean Energy, which has worked on solar and wind projects in the West. “It is certainly an interesting opportunity for the industry and for supporters of clean energy in general.”
Audette Muniz participated in a conference call on the subject sponsored by Interwest Energy Alliance, Northern Arizona University and Utah Clean Energy.
Many opponents of coal-fired power plants have suggested renewable-energy projects to help replace the jobs, lease payments and economic contributions the coal plant and Kayenta Mine make to the northern Arizona communities, which is substantial. More than 800 people work at the plant and mine, mostly members of the Navajo and Hopi tribes.
While it is unlikely a single solar, wind or combination development could replace the money that the tribes and employees earn from the coal operations, officials said such developments should not be ignored.
When the coal plant eventually retires, renewable energy offers the best alternative in the region, Audette Muniz said.
“It would also create revenue from lease payments, community benefits, and has a low-resource impact in a region that has been very severely impacted by coal generation,” she said. “There is no water use and no waste production.”
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The coal plant is owned by Salt River Project, Arizona Public Service Co., NV Energy, Tucson Electric Power and the U.S. Bureau of Reclamation.
Those entities, as well as former owner the Los Angeles Department of Water and Power, also own the transmission lines coming from the coal plant, said Charlie Reinhold, a planning manager with regional power organization WestConnect.
“The transmission system is separate from generation (the power plant),” he said. “The existing owners will continue to own those transmission assets. LADWP continues to be an owner of the elements of the transmission system at Navajo even though they have relinquished ownership in the plant.”
California utilities face greater requirements to supply renewable energy than those in Arizona, which means the Los Angeles ownership of the transmission lines presents an opportunity for solar or wind to help that utility meet its goals, said Amanda Ormond, a representative of the Four Corners Wind Resource Center and Interwest Energy Alliance.
“I do think there is great potential to serve renewable energy to LADWP because of their ownership shares of this transmission,” she said.
Ormond last week addressed the board members of the Central Arizona Project, which is the single largest power user in the state, taking the Bureau of Reclamation’s share of the coal plant and using it to pump water in a massive canal from the Colorado River to Phoenix and Tucson.
“It also makes tremendous sense to serve the CAP, SRP, APS and all the owners with renewable energy,” she said. “The only resource available in that area is wind and solar.”
Of course, the coal plant could find new owners to step in and run the plant beyond 2019, but those prospects seem unlikely, considering the current owners have said it is cheaper for them to buy power from natural-gas plants than to run the coal plant.
Mine owner Peabody Energy has disputed those claims and said the plant could be profitable under new ownership, but a report by Moody’s Investors Service released Monday said “market dynamics have challenged the competitiveness of coal-fired generation.”
The report said coal plants on the East Coast and Midwest face substantial debt and competition from natural-gas plants.
Moody’s analyst Jennifer Chang wrote that several coal plants in that market could face early retirement because they are running at such a low capacity. The report didn’t address the Navajo Generating Station but reflected similar market trends serving as headwinds for that plant.
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