Navajo Nation turns to solar as coal-fired power plant closes

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With the historic Navajo Generating Station now finished as a power source for Arizona cities, the tribal nation is turning its attention to alternative sources of energy that represent a fraction of the coal-fired plant’s economic value.

“As coal markets end and local power plants and mines close, we stand to benefit from the development of clean energy projects and from an economic transition that prioritizes local community voices,” Nicole Horseherder of the environmental group Tó Nizhóní Ání (Sacred Water Speaks) said in a statement as the plant prepared to close. "But we need support from those that profited for decades from the use of Navajo natural resources. That means that federal and state government agencies, NGS owners, and Peabody Energy all have a responsibility to support the Navajo Nation in the restructuring of its economy.”

The NGS not only lit up the booming cities of Arizona but also made water available in one of the most ambitious irrigation projects in U.S. history. After 45 years of supplying electricity to customers in Arizona, Nevada and California, the 2.25 gigawatt plant officially went offline on Nov. 18. Decommissioning the plant near Page, Arizona, on the Navajo reservation is expected to take three years.

“After more than 40 years of generating electricity for millions across the west, NGS and its employees are one reason why this region, the state of Arizona and the Phoenix metropolitan area have been able to grow and thrive,” Mike Hummel, general manager of the operating utility Salt River Project, said after operations ended.

The NGS decommissioning is the largest ever undertaken by SRP. The power plant was built by the U.S. Bureau of Reclamation under a 1968 act of Congress to move water through the 336-mile Central Arizona Project canal from the Colorado River that supplies 80% of Arizona’s population.

Construction of NGS by a team headed by the Bechtel Corp. began in April 1970 as the Black Mesa and Lake Powell Railroad was built by Morrison-Knudsen to carry coal from Peabody’s Kayenta Mine to the plant.

Until recently, the NGS supplied power to Arizona Public Service; the SRP; the city of Tucson, Arizona; investor-owned NV Energy in Nevada; and the Los Angeles Department of Water and Power. As customers switched to cleaner sources of power, and natural gas became less expensive than coal, operating the NGS became less economical.

Power plants across the U.S. are expected to burn less coal in 2020 than they have in 42 years, according to the U.S. Energy Information Administration. Coal-fired power is expected to fall 14%, according to the agency.

In northeastern Arizona, a team of SRP employees and representatives from the Navajo Nation have formed a joint consultation group to manage the decommissioning.

In early October, SRP and the Navajo Tribal Utility Authority opened the second phase of the Kayenta Solar generation facility, a renewable energy plant that provides power to the tribe.

The Kayenta Solar facility, including Kayenta I and II, produces enough emission-free energy to serve about 36,000 homes. The renewable energy credits from the project help SRP in expanding its renewable-energy portfolio.

Last spring SRP was one of 28 volunteer utilities that participated in the Light Up the Navajo Nation pilot project through which 233 Native American families received electric service to their homes for the first time.

"We have come a long way to bring power and light to the residents of the Navajo Nation," said NTUA General Manager Walter Haase. "This solar plant not only brings energy to the Nation but has been a catalyst to help us to improve the standard of living for many Navajo families."

The Navajo Nation is the largest U.S. tribe in area and population and one of several turning from fossil fuels extraction and generation toward a new economy based on renewable energy. The tribe’s general obligation rating was upgraded to A from BBB-plus by S&P Global Ratings in May 2018. Analysts noted that the Navajo do not provide casino gambling as many tribes do.

Tribal lands have the potential for 6,035 gigawatts of utility scale solar power generating capacity, 5% of the total national potential in the U.S., and 891 GW of wind power, 8.8% of the national potential, according to a 2018 study by the National Renewable Energy Laboratory.

The NREL findings were incorporated in a report by the Institute for Energy Economics and Financial Analysis, “Tribal Utility-Scale Solar Initiatives Advance Across Southwest U.S.,” which noted many tribes, especially in the Midwest and the West, occupy areas with some of the best wind and solar resources in the nation, according to the Department of Energy’s Office of Indian Energy. Tribal lands compose about 5.8% of the land area in the contiguous U.S., the NREL report notes.

So far, there are just over 400 megawatts of installed capacity of renewable energy projects on land belonging to federally recognized tribes, including 297 MW of solar, 67 MW of wind, 31 MW of biomass, 6 MW of geothermal and 0.5 MW of hydropower, according to NREL.

Significant renewable-energy projects on native lands include the Arrow Canyon Solar Project on the Moapa Band of Paiutes Indian Reservation in Nevada, according to IEEFA. Under development by EDF Group subsidiary EDF Renewables Inc., Arrow Canyon will combine 200 MW of solar generation capacity with a 75-MW, five-hour battery storage system. NV Energy Inc. has contracted for 200 MW from the project under an agreement that begins in December 2022. In May, Terra-Gen LLC proposed a 252-MW wind energy project on the Campo Indian Reservation near San Diego.

In New Mexico, the Jicarilla Apache tribe is leading efforts to promote renewable energy with the construction of a 50-MW solar farm in the north-central region of the state.

The project would send electricity from solar panels to Albuquerque via the Public Service Company of New Mexico, according to IEEFA.

The project was part of a larger effort to replace power generation lost by the closure of the San Juan Generating Station, a coal-fired power plant in the Four Corners region in northwest New Mexico near the Navajo reservation.

Earlier this year, New Mexico Gov. Michelle Lujan Grisham signed into law the Energy Transition Act, which called for a transition away from non-renewable resources such as coal for power generation and set a requirement that 20% of retail power sales in the state be generated by renewables in 2020.

By 2025, the law calls for 40% renewable, 50% by 2030 and 80% by 2040.

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Utilities Infrastructure Salt River Project Agricultural Improvement & Power District Arizona New Mexico