In San Juan County, there are major decisions and important processes underway regarding the use of coal for power production at our agin power plants, San Juan Generating Station (SJGS) and Four Corners Power Plant (APS).
Understandably one major concern is that of how to maintain good paying jobs and a healthy economy in the midst of such challenging issues. An equally important concern is the economic viability of older facilities and their effect on our surrounding environment. Inevitably decisions must be made, and we are beginning to see that process play out. BHP Billiton has announced its intention to leave mining coal at the Navajo Mine, and is in the process of selling its assets to the Navajo Nation. The latter has voted to proceed with such a purchase pending additional actions by other bodies.
Arizona Public Service Company is in the midst of closing three of its oldest units and deciding the fate of the remaining two units, including determining the future cost of coal and economic outlook for its Fruitland asset.
Customers for power from both local plants are deciding whether current contracts should be terminated and future contracts secured. One of these customers, the City of Farmington, is studying whether to assume seemingly available power from San Juan Generating Station, or move in a different direction through greater use of natural gas-fired electricity.
I would like to address a portion of these issues. The first is the future of coal and whether its relatively low costs will remain stable. We are already seeing that
cleaning up its current emissions has generated considerable costs, and these are likely to increase in the future. Another factor is the so-called "legacy costs."
Students and others at San Juan College have been introduced to the novel "Yellowcake," a story that shows in part the personal costs associated with uranium mining in a previous time. More importantly, as mines and facilities are retired from service, who is responsible for reclamation? Much of the past costs across our nation have been borne by taxpayers through Superfund reclamation activities which pertain to past, present, and future liabilities, including the 50 year legacy of coal mining, burning and ash and other waste disposal.
It is most interesting to see that in two separate actions locally, legacy costs are having an influence. One of the conditions of the sale of Navajo Mine to the Navajo Nation is that BHP Billiton assumes no liability for future reclamation. On the issue of whether the City of Farmington should assume available power from other utilities canceling their contracts with PNM, City Manager Robert Mayes is clear that those utilities will likely be held to paying future reclamation costs, and, I assume, should that not happen, the city would need to look at these future costs in light of whether to proceed to take more coal-fired power from PNM.
This issue is of concern because The Navajo Nation may be at risk for future costs that make such a purchase questionable. The tribe did contract for $53 million
to have a "due diligence" report done on issues such as these, but such a report does not seem to have been made public, nor has there been any indication of what the report found regarding potential legacy costs.
So we have a situation, driven by the real fear that jobs and a part of our economic base will be lost, in which both the Navajo Nation and the City of Farmington are betting exclusively on the future of coal, and in doing so, may be short-changing the possibilities for a broader energy production mix in our area.
This brings up a second issue: fundamentally shouldn't the public have some knowledge of the costs/benefits of financial decisions made in the region so that investments in coal are not allowed to crowd out other alternatives such as plentiful natural gas and renewable sources of sustainable energy? Should not the public be aware of all the steps yet to be taken and what issues will be raised and examined in that process? And should not the citizenry of both Farmington Electric Utility's service area and the Navajo Nation be made aware of future options including costs but also environmental and legacy costs?
The changes we face are daunting; our lives and community institutions will be affected, some more than others. But everyone has a stake in the coming transitions, and making sure the best ideas and opportunities emerge requires that the process be open, and that we all have a chance to influence the kind of energy future that lies ahead. So hopefully we can leave a legacy of our own that our communities and children will benefit from because of our vision.
Gordon Glass is a Farmington resident.