Arizona coal plant may get new life as potential buyers emerge
- Coal mining company Peabody announced private equity firms and power companies expressed interest in the 2,250 MW Navajo Generating Station, but provided scant details about their identities, the Associated Press reports.
- The news comes as a deadline to identify potential buyers passed last week. Earlier this year, four utilities with a stake in the coal plant agreed to close it by 2019. But the agreement sparked controversy from at least one Arizona utility regulator as well as fears that closing the plant would cause economic damage to the Navajo Nation.
- Competition from inexpensive natural gas generators means electricity from NGS is already more expensive than wholesale power prices, the utilities said in a release, a trend that's not expected to reverse in coming years.
The Navajo Generating Station is the largest coal generator in the western U.S thus far, and its potential survival contradicts a recent trend of coal plants shuttering in the wake of cheap natural gas and environmental regulations.
According to the AP, lease negotiations and environmental reviews to keep the plant open beyond the 2019 closure deadline could take years. But it appears the Navajo Nation and the coal mining company are prepared to entertain other offers to keep the facility operating; especially as it employs hundreds from the tribal nation.
Coal generation is experiencing a slight renaissance as natural gas prices rise and the Trump administration pledges support for the resource. Energy Secretary Rick Perry proposed a rule last week aimed at supporting embattled nuclear and coal plants at odds with natural gas. The Department of Energy asked the Federal Energy Regulatory Commission to provide cost recovery for power plants that keep a 90-day supply of fuel onsite to account for their contribution to the resiliency and reliability of the U.S. grid.
In addition, the U.S. Energy Information Administration said in August that coal will top natural gas in 2018.
Correction: An earlier version of this article incorrectly referred to the Navajo Generating Station as the largest coal plant in the U.S.
- Associated Press Few details after deadline for coal plant ownership interest
- The Arizona Republic Sunday deadline approaches for buyer interest in Navajo Generating Station coal plant
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