After nearly 50 years of operation, the closure of the Navajo Generating Station (NGS) near Page remains a daunting challenge for tribal and county leaders. Even with the lease extended through Dec. 31, 2019, officials are pushing to find solutions for the financial whirlwind that threatens to come.
In a domino effect, when the coal fired NGS shuts down, so will the Peabody Mine in Kayenta, which could have a big impact on Navajo County. For years, the county has reaped the benefits of the mine in collecting a sales tax on the coal that was sold.
Navajo County Assistant Manager Bryan Layton said that the amount of sales tax that will be lost at the mine’s closure is significant. “The extension gives us a little more breathing room. The county has already reduced the budget over $2 million with an eye toward the loss of these revenues.”
Even harder hit will be the Hopi and Navajo tribes. In addition to the loss of revenue through lease payments and royalties, it is estimated that there are more than 700 workers between NGS and the mine, with 90 percent of those jobs being held by tribal members.
Leonard Chee, executive staff assistant to the Navajo Nation president and vice president, said he estimates the yearly loss to the Navajo Nation’s treasury will be around $40 million.
While many would say the decline in coal-based energy is due to the environmental impact, there is also the matter of economics. According to the U.S. Energy Information Administration website, demand for steam coal, which is driven by coal-fired electricity generation, is down and in recent years coal has lost part of its electricity generation share to other fuels including natural gas and renewable energy.
Chee shared that the Navajo Nation is looking to create more renewable energy resources through solar and wind, like the Kayenta Solar Project that began operation in 2017.
He also said with the closure of the plant, the tribe would be given the Black Mesa and Lake Powell Railroad, the electricity-run train used to transport coal along 78 miles of track from Kayenta to Page, and one of the main pumps that pulls water from Lake Powell.
Additionally, the tribe is looking to create more tourism in the area. “There is a lot of beautiful land in the Navajo National Monument and we need to take advantage of the tourism the area brings,” Chee said.
Comments by Arizona Public Service, the company that operates the plant along with Salt River Project, Tucson Electric Power and NV Energy, as well as comments by representatives from the Hopi Tribe were not provided as of press time.
