Is the Southwest’s ‘last real stinker’ on its last legs?

  Laughlin, Nevada — Sitting at the bottom of Nevada’s “V,” where the state meets Arizona and California along the Colorado River, the Mohave Generating Station has belched soot and smoke for more than 30 years. When the wind shifts, laundry hanging out to dry in Laughlin backyards gets dusted with a thin layer of charcoal powder. The plant also creates about one-third of the infamous haze that obscures views of the Grand Canyon, 75 miles to the northeast.

For decades, Mohave has been the bane of environmentalists in the Southwest. The “last real stinker,” in the words of Sierra Club Southwest Director Rob Smith, Mohave is the only one of the Colorado Plateau’s 17 coal-fired power plants yet to install sulfur dioxide scrubbers. It’s the single largest source of the pollutant in the West, spewing about 40,000 tons annually into the atmosphere.

In 1997, the Sierra Club, together with the Grand Canyon Trust, sued Southern California Edison, Mohave’s majority owner, in an attempt to force a cleanup of the plant. After intense out-of-court negotiations, Edison agreed to retrofit the plant with state-of-the-art pollution controls by the end of 2005.

That cleanup may never see the light of day. As the 2005 deadline grows nearer, Edison still has not started work. In fact, earlier this year it petitioned the California Public Utilities Commission to let it begin decommissioning the plant at the end of 2005. A shutdown would be welcome news to environmentalists and tourists at the Grand Canyon — but it could devastate the Hopi and Navajo tribes in northern Arizona, whose coal fuels Mohave and provides a huge portion of their struggling economies.

Backed against the wall

The 1999 cleanup settlement was the environmentalists’ dream. It required Mohave to reduce sulfur dioxide emissions by 85 percent and particulates by 99 percent, and also to reduce emissions of nitrogen oxide, another contributor to regional haze.

Why did Edison agree to such stringent controls? Company officials did not return calls for this story, but the Sierra Club’s Smith says Edison settled because it needed to sell the plant. California’s electricity deregulation law, passed in 1996, required the state’s three investor-owned utilities to sell off most of their assets in non-nuclear generation plants. But with a lawsuit hanging over the plant, Edison knew it would be difficult to find a buyer.

Sure enough, on May 10, 2000, less than a year after Edison signed the cleanup agreement, Virginia’s AES Corporation announced plans to purchase Edison’s shares of Mohave. But the deal was quashed by California’s energy crisis. In an effort to stabilize wholesale power costs, the California Legislature reversed course and forbade utilities from selling their generation assets. Edison found itself teetering on the edge of insolvency with an increasingly obsolete power plant, and needing a multimillion-dollar injection to meet the 2005 cleanup deadline.

There was another looming question, this one about Mohave’s supply of coal. On New Year’s Day in 2006 — the same day the scrubbers must be installed — Mohave’s contract with Peabody Energy, the multinational operator of the Black Mesa Mine, expires.

Black Mesa Mine straddles the Hopi reservation’s northern border with the much larger Navajo Nation, just south of Monument Valley. Peabody pays both tribes millions of dollars in royalties for the coal it extracts — money that makes up nearly one-third of the Hopi Tribe’s budget and almost 15 percent of the Navajo Nation’s.

But Hopis have long objected to the fact that, every year, Peabody pumps enough pristine groundwater for about 18,000 families out of the Navajo Aquifer — the Hopis’ sole source of drinking water — to “slurry” the coal through a pipeline, 273 miles to Mohave (HCN, 3/4/02: Is a coal mine pumping the Hopi dry?). The Hopi Tribe has said that if Peabody can’t find an alternative water source by the end of 2005, there will be no new coal contract.

More trouble than it’s worth?

Faced with the huge expense of cleanup, and an uncertain supply of coal, Southern California Edison is now wondering if the Mohave Generating Station is more trouble than it’s worth.

In May 2002, Edison asked the California Public Utilities Commission to allow it to either bill ratepayers $58 million to get started on the pollution-control upgrades, or switch off the plant at the end of 2005. In a filing earlier this year, Edison said that negotiations on the coal and water issues had stalled, and the company “realistically … needed to plan for the decommission and closure of the Mohave facility.”

Peabody and the tribes say they’ve found an alternative water supply for the slurry: The Coconino Aquifer — a shallower and less pristine source of groundwater than the Navajo Aquifer. But tapping the Coconino Aquifer will require environmental studies, which could take longer than the two and a half years remaining before the deadline.

A plant shutdown would be “catastrophic” for the Hopi and Navajo tribes, says Hopi Tribal Chairman Wayne Taylor. He estimates 150 tribal members would lose their jobs, many of which support extended families.

Edison’s threat to close Mohave may be a bluff to force the tribes to back off on their water demands — and to convince California’s Public Utilities Commission to authorize higher rates to pay for the pollution-control upgrades. But instead of backing down, the Hopi Tribe, the Navajo Nation, Peabody and unions representing mine workers, have asked the Utilities Commission to force Edison to make initial investments in the pollution control upgrades. They also want Edison to fund a $1-2 million hydrologic study of the Coconino Aquifer.

And in California, it’s not clear how much leverage Edison has with Mohave. California is highly dependent on natural gas, which provides nearly half the state’s electricity. A low-cost, coal-fired plant like Mohave can help protect against price swings in the volatile natural gas market. Despite that fact, California is clearly readying itself for life without Mohave. The California Energy Commission, which is responsible for statewide energy planning, hasn’t included Mohave in its post-2005 projections.

“The bottom line,” says Lon House, a former commission staffer who now represents the Hopi and Navajo tribes, “is that you’ve got the utilities and the regulatory agencies in the state saying, ‘Hey, we don’t need it.’ ”

The author, a correspondent for Arizona Public Radio, lives in Keams Canyon, Arizona, on the Hopi Reservation.

• Southern California Edison Steve Conroy, 626-302-2255, www.sce.com.
• Sierra Club Rob Smith, 602-254-8362