After a Navajo tribal council on March 21 voted 11–9 to dam acquisition of the Navajo Generating Station (NGS) and Peabody Energy’s Kayenta coal mine, the Navajo Transitional Energy Co. (NTEC) introduced it will drop its bid to maintain the two.Three-GW coal-fired plant close to Page, Arizona, open. 

NTEC, an organization wholly owned by the Navajo Nation, and which owns the Navajo Mine in Fruitland, New Mexico, mentioned on March 22 that the choice by the Navajo Nation Council’s Naabik’iyati’ Committee was prompted partly by “continued demand by the homeowners of the Navajo Generating Station that the Navajo Nation present a vast assure of any legal responsibility for the decommissioning of the plant.” 

NGS, which is powered by low-sulfur bituminous coal from the Kayenta Mine positioned 78 miles away, serves clients in Arizona and Nevada. It provides greater than 90% wanted to pump water by means of the Central Arizona Project (CAP), which is each the one largest end-user of energy and the one supply of renewable water provides in Arizona. Courtesy: IEEFA

In its assertion on Friday, NTEC mentioned it was “pressured to stop its acquisition effort.” It added, “For too lengthy, exterior firms have plundered our land and harmed the environment. With the creation of NTEC, for the primary time in historical past, a tribal entity exercised its sovereignty to regain management of their pure sources and exercised that authority to maneuver ahead on the guiding rules of safety of our tribal authorities, tribal members, and atmosphere over revenue.” 

IEEFA: NGS Struggling to FInd Customers

According to researchers on the Institute for Energy Economics and Financial Analysis (IEEFA), the choice “spells closure” for each NGS and the Kayenta mine. However, David Schlissel, IEEFA’s director of useful resource planning evaluation, claimed the selections have been in one of the best curiosity of  the Navajo folks: “NTEC’s proposal, had it been allowed to proceed, would’ve meant severe long-term financial injury to the Navajo Nation.” Schlissel has beforehand pointed to numerous financial and monetary setbacks related to NTEC’s plan. 

NGS suffers from a “lack of obvious clients to purchase energy from an NTEC-operated plant. The present homeowners of NGS are closing it as a result of it may possibly now not compete with cheaper gas-fired and renewable technology,” IEEFA mentioned. Among different issues are “The burden of cleanup liabilities that may include proudly owning NGS and the Kayenta mine, a burden that may seemingly have value a whole bunch of hundreds of thousands of ,” it additionally famous. NGS, in the meantime, has postponed excessive upkeep prices wanted to function the plant over the 2 years that that closure has been anticipated, it mentioned. “According to SRP, which operates the plant, the deferred upkeep totaled between $150 and $200 million for all three models at NGS, or between $50 and $67 million, on common, per unit,” Schlissel mentioned. 

IEEFA evaluation means that if NTEC paid for the deferred upkeep for less than two of NGS’s models, it will “lose between $20 and $53 million, simply through the 5 years 2020-2024. And this assumes that NTEC is ready to scale back common NGS productions prices to $28.05 per MWh from the $41.72 per MWh that SRP has projected, one thing that’s extremely uncertain, and that vitality market costs stay as little as ahead costs now counsel,” mentioned Schlissel.

NGS’s utility homeowners—which embody Salt River Project (SRP), Arizona Public Service Co., Tucson Electric Power Co., and NV Energy—introduced in February 2017 that they’d now not personal and function the plant after its lease ended on Dec. 22, 2018.

In 2017 and 2018, Peabody Energy sought consumers to maintain NGS open, hiring funding agency Lazard to search for new potential homeowners for the plant. In April 2018, George W. Bilicic, vice chairman of Investment Banking at Lazard, advised a U.S….

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