Navajo Nation considers NGS purchase

Source: White Mountain Independent

Faced with an estimated 23-percent decline in tribal revenues from the planned December 2019, closure of the Navajo Generating Station power plant and Kayenta Coal Mine that supplies the fuel, the Navajo Nation is forging ahead with efforts to take over the operations.

The Kayenta Coal Mine is owned by Peabody Coal Company.

The NGS powerplant is owned by Arizona Public Service, Tucson Electric Power, Salt River Project, U.S. Bureau of Reclamation, and NV Energy. The owners decided to close the powerplant in 2017. The group claimed that the powerplant was unable to compete with plants using natural gas.

Coal powered production of electricity nationwide is declining rapidly. According to the American Coalition for Clean Coal Electricity, in the last eight years, around 40 percent of the capacity of the nation’s fleet of coal-fired power plants has either been shut down or is designated for closure.

But that grim trend has not discouraged the Navajo Nation, the sole owners of the Navajo Nation Transitional Energy Company (NTEC), which acquired the Navajo Mine in 2013. The Navajo Mine has supplied coal to power the Four Corners Power Plant in Fruitland, New Mexico for 50 years.

In July 2018, NTEC took another stake in coal-fired electricity, paying a reported $70 million for a 7 percent stake in two of the production units at the Four Corners Power Plant. The two units were owned by Arizona Public Service, one of the owners who are closing the NGS plant this year.

There were a couple of suitors in line in the last year to possibly acquire the NGS powerplant and Kayenta Coal Mine, but those deals fell through.

According to a report in the Navajo Times, NTEC has assembled a team of energy experts to advise the company.

In a news release, NTEC CEO Clark Moseley is quoted as saying, “We believe there is a clear and beneficial path forward to acquire and operate both NGS and Kayenta Mine as a vertically-integrated entity.”

The tribe and NTEC will have to act swiftly if they plan to prevent the closure of the plant.

Should the tribe be successful in their efforts to acquire and operate the plant and keep the Kayenta Coal Mine open it would also help Navajo County, who receives about $1.5 million in tax revenue from the the Kayenta Mine, which is in Navajo County.

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