Navajo Nation wants NGS coal plant

With no power companies willing to take the risk, the Navajo Nation on Friday said it wants control of a troubled coal plant near Page that is slated to close next year.

The facility is too important to the tribe’s economy to let it close, tribe officials said.

Salt River Project and the other utilities that own the Navajo Generating Station voted in 2017 to close the three, 750-megawatt generators at the end of 2019 because it is cheaper to buy power from natural gas plants.

But the tribe and the U.S. Bureau of Reclamation, which owns a portion of the facility, have sought to keep it running. In September, the only seriously interested buyer walked away from negotiations and closure looked certain.

But the tribe says that’s unacceptable, as it would cripple the economies of the Navajo Nation and Hopi Tribe.

“It’s not over until it’s over,” Navajo Nation Speaker LoRenzo Bates said Friday. “We are going down the path to keep NGS open.”

Approximately 750 people, mostly Native Americans, work at the plant and Kayenta Mine that supplies it when the facilities are fully operational. The tribe also benefits from lease payments, coal royalties and myriad ancillary transactions, such as selling power to the mine.

The Hopi Tribe also relies heavily on the mine, which is partially on its land and partially on Navajo land.

Shuttering the power plant would force the mine to close and cause a massive ripple effect across the reservations. Both tribes get substantial percentages of their budgets from the coal operations and would be forced to cut services if those revenue streams go dry.

“The Navajo Nation is the ultimate decision maker on the future of NGS,” Bates said. “Navajo is taking the lead.”

What would a deal look like?

Exactly how a deal could work, including whether the tribe needs financial partners and who will buy the electricity, need to be worked out, Bates said.

“Granted, there are many moving pieces here we have to deal with,” he said. “We are working through the many pieces.”

SRP officials said they would work with the tribe.

“As we worked with others, we will continue to provide support and information to the tribe as they decide whether to pursue a transfer of assets,” SRP spokesman Scott Harelson said. “Timing remains a growing challenge.”

SRP is only maintaining and repairing what it needs to run through 2019, deferring hundreds of millions in longterm maintenance at the plant. The tribe or any other entity that takes over the facility will have a months-long backlog of work to catch up on, which essentially guarantees at least a temporary shut down in December 2019 when SRP’s current lease expires.

New Mexico deals cited

Bates said the tribe’s purchase of a New Mexico mine and part of a coal plant near Farmington shows the tribe can execute such deals.

“You’ve had that as an example that says we can do this,” Bates said.

The Navajo Transitional Energy Co., which formed in 2013 to buy the Navajo Mine, in 2016 paid off BHP Billiton for the mine.

Then last year, through NTEC, the tribe bought a 7 percent share of the Four Corners Power Plant from Arizona Public Service Co. The power plant gets its coal from the Navajo Mine.

“We are no longer sitting on the sideline,” Bates said. “We are a major player in producing coal and generating electricity.”

Critics of the coal operations, including many environmentalists, have argued that the tribe should focus on transitioning to new revenue sources, including renewable energy.

Many activists who have pushed for the coal operations to close long suspected the tribe would eventually make a play to take over the plant.

“We were waiting for this,” said activist Nicole Horseherder, who lives near