Utilities reach settlement with federal agencies on Four Corners Power Plant

James Fenton The Daily Times
The Daily Times

FARMINGTON — Representatives of federal agencies announced a federal Clean Air Act settlement with Four Corners-based utility companies Wednesday to install pollution-control technology to reduce air pollution from the Four Corners Power Plant near Fruitland.

The Department of Justice and the Environmental Protection Agency's joint settlement with the Arizona Public Service Co., the majority owner and primary operator of the power plant, comes without any admission of wrongdoing from APS but levees a $1.5 million civil penalty against APS to be paid within 30 days.

The settlement also mandates that APS spend $6.7 million on three Navajo Nation projects, including a $3.2 million project to replace or retrofit inefficient, higher-polluting wood-burning or coal-burning stoves or fireplaces with cleaner-burning, more energy-efficient heating appliances. The company will also have to pay $1.4 million for a weatherization project, which will upgrade and better insulate Navajo homes.

A third project will allot about $2 million to pay for respiratory health care and transportation costs to see a doctor for Navajos who reside in the vicinity of the power plant.

The public will have 30 days to comment on the settlement, which will become final with a judge's signature.

New Navajo Nation President Russell Begaye praised the conservation groups that sued over health and environmental concerns posed by the power plant in 2011.

"We appreciate that the health of the Navajo people was considered," Begaye said in a statement on Wednesday. "While $6.7 million will provide many needed improvements for the Navajo people affected by the power plant emissions, we still have much more that needs to be addressed. We applaud the tenacity and dedication of the grass-roots organizations that remained united throughout this process and never gave up, for the health and well-being of their people."

One of those groups is Diné Citizens Against Ruining the Environment.

Sarah Jane White, a Diné CARE member, said in a phone interview on Wednesday that she sees the settlement as a victory for the Navajo people.

"I am not jumping up and down (about it), but I am happy about it," White said. "I am happy for the people who are going to receive help. I'm glad that we won this case. There's so many people on the reservation who have respiration problems because of that plant."

Wednesday's settlement alleges APS made "major modifications to major emitting facilities and failed to obtain the necessary permits and install and operate the controls necessary under the (Clean Air) Act to reduce sulfur dioxide, nitrogen oxides and particulate matter" at the power plant, according to legal documents.

The power plant operator said the changes were part of standard maintenance at the power plant and did not require permitting.

The Arizona-based utility was named as a defendant in the action along with the power plant's co-owners, including the El Paso Electric Co., the Public Service Company of New Mexico, the Salt River Project Agricultural Improvement and Power District, and the Tucson Electric Power Co.

U.S. Attorney Damon P. Martinez for the District of New Mexico said the settlement will ensure emissions reductions and mean additional benefits to the people of the Navajo Nation.

"This settlement will reduce pollution from the Four Corners Power Plant for years to come, and requires the Plant's owners to fund significant health and environmental projects that will further benefit the Navajo Nation and other communities impacted by the Plant," Martinez said in a statement. "We also applaud the efforts of the citizen groups and other co-plaintiffs who helped represent the interests of the Navajo people and the environment so well, and who contributed significantly to obtaining such a fine result for the Four Corners Region."

Ann Becker, APS vice president of environmental and chief sustainability officer, said in a phone interview on Wednesday that while the company refutes the allegations made in the consent decree by the federal government, the settlement at least guarantees certainty for the power plant.

"The settlement gives us certainty with the plant in regards to the continuing operations (there)," Becker said. "Our goal all along has been to provide certainty for the power plant, and this is one more action that we took towards that."

But Becker said the federal agencies' legal action is merely a reflection of the "EPA's agenda against coal-fired generation," she said.

Becker said two actions by the company demonstrate its willingness to comply — and exceed — regulations for clean air.

One is the permanent closure of units 1, 2 and 3 at the 1,540-megawatt power plant in 2013. The other is the company's increase of "removal efficiency for sulphur dioxide" at the plant from a regulation-enforced 75 percent to 80 percent, Becker said.

Erny Zah, spokesman for Navajo Transitional Energy Company, the tribal utility that owns the mine, said the settlement offers resolution. The Navajo Mine is the sole coal supplier to the power plant.

"We weren't a named party to the action, (but) we are pleased that the involved parties came to a resolution," Zah said. "We're reviewing the settlement and support our customer's decision to move forward."

Daniel Ware, spokesman for BHP Billiton, said the company, which is currently operating the mine on behalf of NTEC, was not part of the legal action. NTEC is expected to announce candidates for a new mine operator later this summer.

"BHP Billiton New Mexico Coal was not, in any way, party to the litigation and had no role in the negotiation of the consent decree," Ware said in an email. "While we have not been able to review the voluminous technical consent decree, we're hopeful that it represents a sound and fair resolution."

James Fenton is the business editor of The Daily Times. He can be reached at 505-564-4621 and Follow him @fentondt on Twitter.