Environmental Victory?

Sithe: ‘First we need to find something that fits’ at Desert Rock

By Kathy Helms, Diné Bureau

WINDOW ROCK — Current market conditions for electricity, especially power generation from coal, along with global climate change issues could precipitate a modification in the proposed Desert Rock Energy Project.

Rumors of the demise of the 1,500 megawatt coal-fired power plant near Farmington surfaced again this week, but Dirk Straussfeld, executive vice president of co-developer Sithe Global Power, said Friday morning from Germany that Sithe has not pulled out of the project with the Navajo Nation's Diné Power Authority.

Straussfeld met recently with a number of DPA board members and told them they need to determine whether Desert Rock should be considered as some kind of different power plant so they can get something going without litigation and get everybody on board. Regional environmental groups have challenged the project at nearly every move.

"The Navajo Nation is working with Sithe on reviewing the project and potential alternatives that would meet the market needs, but I can assure you, we have not pulled out," Straussfeld said.

Economic conditions, reduced consumption of electricity and a corresponding reduction in market demand for new power generation—especially 1,500 megawatts from coal—and environmental mandates at federal and state levels are forcing many companies to rethink plans for new and existing power plants.

Southern California Edison recently informed Arizona Public Service it will divest its 48 percent share of Four Corners Power Plant by 2016 because of sweeping greenhouse gas regulations enacted by California will prohibit SCE from buying power produced from coal.

Four Corners provides about $65 million annually to the Navajo Nation in taxes, fees and royalties. The Nation expects to receive about $52 million annually from Desert Rock if it is built as a coal plant.

Straussfeld said Sithe is "committed to work with the tribe on realizing a power project at Desert Rock. If we find an alternative that fits in the market, we will work with the tribe and be a part of this development, but first we need to find something that fits in the market.

"We look at coal, we look at solar, we look at pretty much everything—various combinations of fossil and renewable," he said. "Desert Rock could change its form, but no decision has been made," he added. "If there is a change in plan, that decision is expected by summer."

In March, it was announced that Sithe had abandoned the idea of building a 750-megawatt supercritical pulverized coal plant near the Toquop Indian Reservation in Nevada. A more environmentally friendly, 700 megawatt natural gas-fired electrical generation plant combined with a 100 megawatt solar-powered plant will be built instead.

Stephen Begay, DPA general manager, confirmed there are internal discussions and talks with Navajo Nation officials about potential changes to Desert Rock.

Difficulty in obtaining carbon-capture funding from the federal government for a pilot project at Desert Rock is just one of many factors. Begay said that since Desert Rock is comprised of two 750-megawatt units, it might be easier to obtain funding for carbon capture on one unit.

"Maybe we start there and the second unit would kind of be open. We're not saying that's what's going to happen, but I think we're looking at the options. Initially, I think we need to look at carbon capture as a pilot project at Desert Rock and then work toward commercial scale application at the plant. That would be the way we would want to proceed," he said.

"We're still on track to do what we can with Desert Rock as an ultra-supercritical power plant, but given the changes in energy demand and some of the concerns of off-take for coal power versus off-take for renewable power, we have to consider those factors in our discussion with the Nation."

While DPA is open to considering the options of a modified version of Desert Rock, Begay said, "I think the key is the economics and the use of Navajo resources to kind of support its own sustenance."

Meanwhile, Elouise. Brown, president of Dooda Desert Rock, one of the grassroots groups opposed to the coal plant, returned this week from Cochabamba, Bolivia, where she attended the World People's Conference on Climate Change.

"People have been asking me what a Navajo grassroots group is doing at a world climate conference in Bolivia. The simple answer is that we need to carry our campaign to wherever we can focus attention on the facts."

Brown said the major fact is that no one is addressing is the findings of studies of air quality in the Shiprock area where Desert Rock would be located. Those studies showed that Navajos living downwind of the two existing power plants must seek medical attention at high rates.

"We raised the issue that the proposed Desert Rock power plant violates the provisions of Diné Natural Law in the Fundamental Laws of the Diné. ... Area energy companies spent a lot of money to negate Mother Earth's rights, and I went to Bolivia to make them stronger," she said.

Brown also forged new alliances, to make it possible for Dooda Desert Rock to have a presence in the development of international law and policy, she said. "I will be sitting next to the Navajo Nation delegates in Geneva to tell the United Nations how the Nation is violating the rights of Mother Earth."