By Nolan Madden SB1506 was designated last month for State Senator Carlyle Begay’s proposed formation of a power district, or utility improvement zone, in Navajo County. Per the bill, SEC Power Corporation, the Snowflake-based energy developer Begay has eyed for the project, would potentially give current and prospective industries and residents a privately owned option for more affordable and reliable electricity and Internet connectivity. Skyler Careaga, chief executive officer of SEC, at the time described his firm’s 171-acre solar farm, powered by photovoltaics and natural gas turbines, as a radical alternative to solving the county’s problematic history of power outages and lack of high-speed Internet connectivity, with the proposed production capacity to initially produce more than 200 megawatts within a three-year time frame. Careaga has since presented numbers to back up his claims. His figures model out estimated cost savings for switching from current public power providers at a six percent utility sales tax rate that splits between county and state (Figure A), savings versus 2014 utility bill figures (Figure B) and Net Savings Effect (Figure C), at penetration rates of 10, 20, and 30 percent for a one-year time frame: * One year at 10 percent penetration, (A) $223,776 tax on power, (B) $72,000 county cost savings and (C) $295,776 net savings. * One year at 20 percent penetration, (A) $447,552 tax on power, (B) $72,000 county cost savings and (C) $519,552 net savings. * One year at 30 percent penetration, (A) $671,328 tax on power, (B) $72,000 county cost savings and (C) $43,328 net savings. “This does not even touch on outside sales from Navajo County. Since we will be domiciled in Navajo County, outside sales from other regions will be taxed for sales in that district, creating an unknown amount of revenue,” said the CEO. He cited as an example 40 megawatts of power hypothetically sold on-grid to Las Vegas, Nev., at the wholesale rate of three to four cents. He estimates that a six percent utility tax on that capacity at the three-cent rate would equal $1.2 million, garnering $72,000 of potential revenue for the county. Snowflake Mayor Tom Poscharsky says that he is optimistic about the project and its economic development potential for the region. “With EPA (U.S. Environmental Protection Agency) closing all of the coal plants, the idea of being able to tell the potash industries, whom we’re still in talks with and hoping to attract them here as the commodities prices stabilize, that they can have 10-cent electricity for the total life of the mine is like telling them that you’ve got a hydro dam and that you’re going to let them have some of the power. It’s a win-win for the towns, for sure,” he noted. In a letter to the Navajo County Board of Supervisors in support of the bill, Poscharsky expressed, “I attended a meeting with SEC Corporation in Snowflake along with Homero Vela and Jason Whiting in mid-December, and was very skeptical at first…APS (Arizona Public Service Co.) is against the bill and its lobbyists are trying to kill it. “This is the same APS that had former county supervisor J.R. DeSpain call a meeting in the Code Talker Room at the county to ask all the local governments to adopt resolutions to send to Governor Brewer to fight the EPA regulations to save Cholla so that our rates would not double. “We all did it, but the next year APS’ Board of Directors, in the interest of their shareholders and privately regulated company, agreed with the EPA to shut down one unit and not renew their coal contract in 2025 for the rest of the plant, shutting it down. So the county and its taxing units face the loss of $9.8 million in taxes from Cholla and the jobs associated with the plant. We will also have very expensive power bills which will hurt our ability to attract and keep jobs. “I am not ready to say that we should go ahead with the project, but my due diligence, based on my experience with public power, indicates that this is a big potential blessing for the economic future of all of Navajo County that we cannot afford to have taken away from us by APS.” APS responded to Poscharsky’s comments in an official statement through its media relations communications consultant, Anna Haberlein, noting, “As the bill currently stands, we are opposed, as are the other utilities in the state.”