The smokestacks of the Navajo Generation Station rise 775 feet from the sere landscape of the Navajo Nation in northern Arizona, just three miles away from the serpentine, stagnant blue wound in sandstone known as Lake Powell. Red-rock cliffs and the dark hump of Navajo Mountain loom in the background. Since construction began in 1969, the coal plant and its associated mine on Black Mesa have provided millions of dollars to the Navajo and Hopi tribes and hundreds of jobs to local communities, as well as electricity to keep the lights on and air conditioners humming in the metastasizing cities of Phoenix, Tucson, Las Vegas and Los Angeles. Yet they also stand as symbols of the exploitation of Native Americans, of the destruction of the land and the sullying of the air, all to provide cheap power to the Southwest.
But coal power is no longer the best energy bargain. And in mid-February, the plant’s four private utility owners, led by the Salt River Project, voted to shut it down at the end of 2019, some 25 years ahead of schedule. When the giant turbines come to a halt and the towers topple in the coming years, the plant will become a new symbol, this time of a transforming energy economy and an evolving electrical grid that is slowly rendering these soot-stained mechanical megaliths obsolete.
The closure will deeply wound local economies, particularly in Page, LeChee, Kaibeto and Kayenta. Employment numbers fluctuate, but according to an environmental impact statement prepared to analyze the previously planned 2019 renewal of the plant’s lease, the Navajo Generating Station, the Kayenta Coal Mine on Black Mesa and the 78-mile electric railroad that carries coal from the mine to the plant employed 935 workers in 2014. Ninety percent of them are Native American. The average payroll expenditure per employee (wages, salaries, benefits, etc.) is $141,500.
The operating budgets of the Navajo Nation and the Hopi Tribe will also take a severe beating. Both tribes got the short end of the stick — a royalty rate of just 3.3 percent — when Peabody Coal first obtained the leases to mine Black Mesa in the 1960s. The attorney representing the Hopi Tribe, John Boyden, was actually on Peabody’s payroll at the time, and managed to get a sham tribal government to sign over mining rights against the objections of traditional Hopis, as has been thoroughly chronicled by Colorado writer and law professor Charles Wilkinson. The mines — Black Mesa and Kayenta — forced families to relocate, destroyed grazing land, dried up springs and wrecked ancestral Hopi shrines and other sites.
The tribes fought back and eventually negotiated better terms. Both tribes now rely heavily on royalty and lease payments from the mine and the power plant, even as tribal members fight against the polluting and water-gulping ways of plant and mine. Those royalties, bonus payments and water-use fees amounted to $54 million in 2015, paid to the Hopi Tribe and the Navajo Nation by the owners of both the Navajo Generating Station and the Kayenta Coal Mine.
Peabody Western Coal Company and the Salt River Project — the plant’s operator — donate around $1.7 million each year to local scholarships and charity. The Kayenta Coal Mine buys $9.9 million dollars worth of electricity yearly from the Navajo Tribal Utility Authority. Before the closure announcement, the plant’s owners and the Navajo Nation had been renegotiating the lease, which runs out in 2019, to make it more favorable for the tribe. Peabody also hoped to expand the mine.
Yet without the Navajo Generating Station, one of the biggest polluters in the West, the air, water and land of the Colorado Plateau will be far cleaner. Each year, the plant and the mine emit nearly 20 million metric tons of carbon dioxide, methane and other greenhouse gases. The plant also spews sulfur dioxide, nitrous oxides and thousands of pounds of mercury, selenium and arsenic. These elements, which are toxic to humans and wildlife, have shown up in relatively high concentrations in fish in the Grand Canyon and the San Juan River upstream from Lake Powell, as well as in precipitation at Mesa Verde National Park. Meanwhile, the plant produces about 1.3 million tons of solid waste, most of which is dumped nearby.
Natural gas burns far more cleanly than coal, so if all of the lost power generation is replaced with natural gas-generated electricity, then greenhouse gases would be cut in half and the particulates and other emissions cut to almost zero. Natural gas production, however, like coal production, emits methane, a powerful greenhouse gas, along with other potentially harmful hydrocarbons.
The plant also plays a huge role in the Southwest’s water-energy nexus. The Kayenta Coal Mine draws about 1,200 acre-feet of groundwater annually from the Navajo Aquifer for various uses. The Navajo Generating Station, meanwhile, pulls about 28,000 acre-feet — or 9 billion gallons — of water from Lake Powell each year, for steam generating and cooling. Some coal plants return some of the water to the source; the Navajo Generating Station does not. The Bureau of Reclamation owns a large fraction of the plant and uses most of its share of electricity to run the pumps for the Central Arizona Project, which delivers Colorado River water to Arizona cities. To move about 1.6 million acre-feet of water annually, the pumps use about 3 million megawatt-hours of juice, enough to power about 240,000 Arizona homes.
Navajo Nation President Russell Begaye pleaded with President Donald Trump to do something to keep the plant open, but apart from purchasing the entire plant and operating it at a loss, there’s little the federal government can do. That’s because economics, not regulations, are driving the plant’s closure. Salt River Project officials note that it’s now cheaper for them to buy power for their 1 million customers from other sources than it is to generate power at Navajo, thanks mostly to low natural gas prices. A November 2016 study by the National Renewable Energy Laboratory found that the Central Arizona Project pays about 15 percent more for electricity from the power plant than it would if it bought power wholesale from the Mead trading hub located near Las Vegas.
None of this will change even if Trump rolls back regulations put in place by the Obama administration. In fact, if a drill-heavy energy policy goes into effect, it will increase natural gas supplies, thus further increasing the spread between natural gas and coal. Still, environmental protections do play a role, albeit a smaller one than the economics does: California’s move away from coal power lowers the value of the plant’s power, and the requirement that the plant install nitrous oxide-reducing equipment increases costs.
The electrical landscape is evolving in other ways, as well. The days of vertically integrated utilities that own huge, centralized power stations and their own balkanized grids are giving way to a new era in which utilities purchase power generated by smaller plants that are connected to larger, regional grids.
California’s independent grid operator has already joined up with NV Energy, PacifiCorp and other Western utilities to form an energy imbalance market, which allows the utilities to share generators — whether wind, solar, natural gas or coal — to “balance” their grids in real time, rather than having to rely only on their own generators. These utilities are hoping to expand this market and then take it to the next level of a regional, integrated grid in coming years. The closure of the Navajo Generating Station adds new urgency to this effort, and a more integrated grid will ease the utilities’ transition away from the plant.
The decision to close the plant came as a surprise. The plant’s owners had been negotiating a new lease with the Navajo Nation and considering shutting one of three units and replacing it with other energy sources. Meanwhile, the mine was looking to expand. Outright closure this soon was not on anyone’s radar, so there is no firm transition plan in place. Both the Bureau of Reclamation and Peabody have expressed a desire to keep the plant running beyond 2019, but they’d have to do it without the other owners and against economic headwinds.
When the Mohave Generating Station and the Black Mesa Mine closed in 2005, environmentalists and tribes pushed the California Public Utilities Commission to create a revolving “just transition” fund with money earned from the sale of sulfur dioxide credits from the shuttered plant. The fund, the value of which dwindled as sulfur credit prices fell, is supposed to help develop renewable energy on the reservations.
There are few or no such credits available for the Navajo Generating Station, however, so that approach won’t work here. A coalition of Navajo groups that have been resisting the plant and mine for years want the Navajo Nation and Hopi Tribe to demand a full remediation and reclamation of the plant and mine; to push the plant owners to replace lost electricity generation by building new solar, wind or other plants on the reservations; and to take over the two high-voltage transmission lines and secure the substantial water rights held by mine and plant.
“I am very happy and relieved that Black Mesa Trust’s struggle to save sacred waters on Black Mesa will finally end in 2019,” said Black Mesa Trust Executive Director Vernon Masayesva in a statement. Masayesva, a former Hopi tribal chairman, has battled the mines on Black Mesa for years. “It is time to begin healing the ecological-cultural landscape.”
Jonathan Thompson is a contributing editor at High Country News. He is currently writing a book about the Gold King Mine spill. Follow @jonnypeace
This article appeared in the print edition of the magazine with the headline The West’s coal giant is going down.
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