FARMINGTON — As San Juan Generating Station moves forward with plans to close two units without layoffs of company employees, workers not directly employed by the plant are wondering about the security of their jobs.

“The biggest issue I'm worried about is jobs and how it's going to affect the economy in the region,” said George Riley, Four Corners area agent for the Plumber and Pipefitters Local Union 412.

Public Service Company of New Mexico, primary owner of San Juan Generating Station, filed documents with the Public Regulatory Commission seeking permission to proceed with a plan that would close two of four units at the coal-fired power station.

“We recognize that a two-unit shutdown at San Juan will have an economic impact. We are working to minimize that impact, and have made a commitment not to lay off SJGS employees as a result of the plant retirement,” stated Valerie Smith, PNM spokeswoman, in an email.

San Juan Generating Station employs nearly 400 people.

Riley said as many as 300 people could be working for different companies contracted by the power plant at various times, but he estimates about 50 are currently working.

Smith said the need for workers at the power plant varies according to the needs of the power plant.

“Regarding contractors, third-party work at San Juan is cyclical by its very nature,” Smith wrote. “During large projects such as plant outages for maintenance, we may have dozens of contract workers on site, but during non-outage windows, there may be limited contract work that is ongoing. That's one-reason we use contractors for this type of cyclical work instead of full-time positions. We do anticipate that contractor work would be reduced on an ongoing basis as we move to two units instead of four.”

But Smith added that the power plant will be expecting to create jobs when they begin to install the emission reducing technology and as the power plant begins to build the natural gas units.

Even though the plant plans to shut down two units and lose about 340 megawatts, PNM has plans to build a 177 megawatt natural-gas power facility to be used during times of peak demand, and to build a 40-megawatt solar facility.

PNM officials have stated the installation of emission controls would cost between $60 to $80 million.

Riley said the jobs created by the emissions control installation and the building of the natural gas power plant would only be temporary.

Riley said he is also concerned about the long-term future for PNM customers because another part of PNM's plan is to use 134 megawatts from Palo Verde Nuclear Generating Station in western Arizona.

The nuclear power plant is primarily owned and managed by Arizona Public Service with six other owners. Of those companies, four utility companies based in California and Arizona have larger shares of the power plant than the New Mexico utility's 10-percent share.

He said if there are brownouts in California and Arizona, he fears that New Mexico customers won't receive the needed power.

Smith said the power distribution is regulated by agreements with the Western Electricity Coordinating Council and that because of existing agreements, one state's needs couldn't thwart another's.

“There wouldn't be the ability to give one state preference over the other in an emergency situation,” she said, adding that PNM-owned power in Palo Verde can't be redistributed.

Damon Gross, Arizona Public Service spokesman, also said the owners have a rights to their power.

“Each of the owners of the plant get an allotment proportionate to their ownership share. Each owner has a right whatever percentage they own,” Gross said.

Moreover, Smith added that the baseload power PNM owns at Palo Verde along with other power generating plans should be sufficient to meet the needs of the utility.

“The power that is generated is ours to control, within the rules of the grid. I don't think that's a concern from our perspective,” Smith said.

 

Erny Zah is the business editor at The Daily Times. He can be reached at 505-564-4638 and ezah@daily-times.com. Follow him @ernyzah on Twitter.