— By Lisa Meerts — The Daily Times
Farmington Daily Times
Article Launched:09/09/2007 12:00:00 AM MDT

FARMINGTON — The Farmington Electric Utility has applied to the New Mexico Environment for air permits which set pollution limits for two of its natural-gas powered facilities — the Animas Power Plant and Bluffview Power Plant.

The permit for the Animas Power Plant is being renewed as is required every five years, but the two-year-old Bluffview Power Plant will receive its operating permit when the process is complete.

Mary Uhl, New Mexico Environment Department Air Quality Bureau chief, said both power plants emit very few pollutants compared to giant power plants, like the San Juan Generating Station and Four Corners Power Plant. The newer Bluffview plant employs selective catalytic reduction technology to reduce nitrogen oxide emissions, but the Animas Power Plant does not. Nitrogen oxides form with volatile organic compounds to create ozone.

Each power plant has one violation on record since 2005 and both have been settled, Uhl said. The Animas Power Plant received a violation for failing to submit two certifications and the Bluffview Power Plant missed monitoring and record keeping once.

Michael Sims, generation manager at the Farmington Electric Utility, said the violations stemmed from equipment failure.

"From time to time, we have an emissions monitor that's not reading for an hour," he said. "We're required to file a report and take corrective action."

The Bluffview plant can produce 60 megawatts of energy and the Animas plant can provide 50 megawatts. But even with generation from the Navajo Hydroelectric Station, which varies from six to 30 megawatts depending on San Juan River flows, the Farmington Electric Utility is running out of power.

It has a long-term contract with Western Area Power Administration to purchase some 50 megawatts of generation daily and a short-term contract to purchase power from the Public Utility Service of New Mexico when it needs even more. At its peak, the Farmington Electric Utility used 202 megawatts per day this year — less by about four megawatts than last summer.

"We know we're going to be purchasing some power, so we buy those in long-term blocks. But if generation goes down and we need power right away, then we go to PNM," said Steve Henson, the utility's systems operations manager. "You wouldn't see (price changes) on your bill."

But the steadily rising demands of its customers have the Farmington Electric Utility planning for the future. Sims expects serious studies on whether the utility should build more or plan to buy more electricity to be under way within six months.

Their plans, however, depend largely on industrial customers, such as the oil and gas industry. When a company plans to add a new compressor or other similar devices, it can cause a spike in demand. Add it all together, and the utility finds it cannot generate enough of its own power and turns toward other suppliers, Sims said.

"When we built Bluffview, we expected to have 30 megawatts of excess capacity for three or four years," he said. "Then we had some huge industrial loads come online, and before the plant came online, we had used all of that up. It's very, very hard to plan for this area."

While the utility is planning ahead, it does not expect it will count on the proposed Desert Rock Power Plant for generation. For one, said Sims, there are too many unanswered questions and it remains unclear whether the plant will be built. Second, it's also unclear how energy would be transmitted.

"Until we're sure that's going to happen, I don't think we're going to be very serious about purchasing part of the plant or power from the facility," he said.

Henson seconded Sims' opinions and described the challenges a bit like hedging bets. A company may approach the utility and say it expects to build a facility next year, but until they have the permits, the utility company cannot really prepare for it without putting itself at risk.

"That puts us in a real bind. Are they serious? Are they going to do it? We just can't go build the facility and hope they were serious," he said.

Lisa Meerts: lmeerts@daily-times.com.