Closing coal-power station could have economic impact

FARMINGTON, N.M. — One of the biggest issues looming over a northwestern New Mexico county is the potential closure of a coal-fired power plant in 2022 — about 20 years before the end of its useful life.

The closure of the San Juan Generating Station, which provides electricity to an estimated 2 million customers in the Southwest, is expected to have severe economic consequences for San Juan County, the Farmington Daily Times reported earlier this week.

“We’re looking to lose coal,” Farmington Mayor Nate Duckett said during a City Council meeting last month, as the city considered raising gross receipts taxes. “Not if, but when … and that is going to have dire consequences for schools across the state, for the city here, for San Juan County.”

A study commissioned by Four Corners Economic Development estimates closing the San Juan Generating Station and the accompanying San Juan Mine will lead to more than $105 million in lost wages in San Juan County and nearly 1,500 lost jobs.

The city of Farmington, in addition to lost taxes and jobs, will have to replace the electricity that it receives from the generating station.

The study also estimates that companies who supply the mine and power plant with equipment will lose $31.7 million, and San Juan College students will lose $115,000 annually in scholarships supplied by the plant and the mine. United Way is estimated to lose $150,000 in donations from the plant and the mine.

The San Juan Mine pays $6.5 million in severance, conservation, gross proceeds and resource excise taxes each year, and closing the mine will result in a reduction of the state’s coal tax revenues to $3 million annually. In fiscal year 2014, the state received $16 million in coal tax revenue total.

San Juan County receives 10 percent — $3.8 million — of its property tax revenue from the coal mine and power plant.

The Central Consolidated School District faces the loss of $3.6 million in property tax revenue from the closure of the two entities.