Desert Rock not dead, power authority

By Noel Lyn Smith
Navajo Times

WINDOW ROCK, April 15, 2010

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Despite an air permit withdrawn last year, the Desert Rock Energy Project is still alive an official with Diné Power Authority told members of the Resources Committee last week.

"People ask you (the committee) is Desert Rock dead?" DPA general manager Steven Begay said. "Desert Rock isn't dead, it's still a good project."

In a report to the committee April 8, Begay said DPA is in the process of reapplying for the air permit, which was remanded in September 2009 by the administrative appeals board for the U.S. Environmental Protection Agency.

The EPA first issued the permit in July 2008 but the agency asked for a voluntary remand in early 2009. The EPA requested the withdrawal because its initial review did not consider the project's impact on endangered species and to fully comply with the Clean Water Act.

Begay said the delay in Desert Rock's start could be blamed on federal laws and the federal process along with new environmental regulations.

"But Navajo is ready," Begay said before adding that DPA has completed its side of the development process that was requested by Sithe Global Power, a Houston-based energy company that is the tribe's partner for the $3 billion project.

Unknown is whether or not Sithe will continue to operate Desert Rock as a coal-burning power plant or seek a renewable energy source, since the EPA has stricter greenhouse gas emission standards.

Recently, Sithe has changed or eliminated construction plans for coal-burning power plants. Last month it announced a switch to natural gas and solar energy to supply a plant in Nevada. In February, Sithe dropped plans for a waste coal-burning facility in Pennsylvania.

An attempt to contact Dirk Straussfeld, Desert Rock project manager, about Sithe's plans for Desert Rock was unsuccessful. An employee at Sithe's office in Houston said Straussfeld does not grant interviews.

DPA is also asking legislators from the region's state governments to support the power plant project. Both New Mexico and Colorado have objected to Desert Rock in the past.

"We didn't get that help in our application and that's where we feel that was weak," Begay said.

When the appeals board revoked Desert Rock's air permit last year, New Mexico Gov. Bill Richardson praised the decision.

"This decision validates what my administration has long argued - that the Bush administration was wrong not to look at harmful greenhouse gas emissions in issuing this permit," Richardson stated in a Sept. 25 press release.

To this day, the state continues to oppose the project.

"Our position remains the same," said Marissa Stone, communications director for the New Mexico Environment Department, in an April 14 e-mail.

The Bureau of Indian Affairs continues its work on finalizing the environmental impact statement and DPA is continuing to work with the EPA, the U.S. Fish and Wildlife Service, the U.S. Office of Surface Mining, consultants and attorneys to finish that report.

The proposed Desert Rock power plant would burn coal from BHP Billiton's Navajo Mine to generate 1,500 megawatts of electricity.

Throughout discussion about the project, local environmental groups have opposed it based on the environmental impacts, particularly that it would contribute to pollution since there are already two other coal-burning power plants in the area, the San Juan Generating Station and the Four Corners Power Plant.

Begay asked the committee to continue supporting the tribe's interest in coal, including the operations of BHP Billiton since its mine will be the main supplier of coal for power plant.

"We have to remember that there's a tangible value there and we want to hold onto it and the way to do it is to support our coal development," he said. "If we don't stick up for coal development and let the opposition win, we'll never get to develop our coal the way we want to and we lose a lot of royalties."

After Begay's report, Vice Chair Curran Hannon (Oak Springs/St. Michaels) read a comment from LoRenzo Bates (Upper Fruitland) reassuring the council's support but also questioning if the project is worth continuing after facing many challenges.

Before answering the question, Begay said that at this point, the tribe has invested $20 million in Desert Rock, along with $20 million by Sithe, $20 million by the federal government and $10 million by BHP.

"There's a lot of money that has been put into it, do we want to let it go," he said. "I don't think so."

Begay also requested that the committee meet again so he can present more detailed information about Desert Rock.

"Personally, I would like to see this built," said Phillip Harrison Jr. (Cove/Red Valley) about the potential benefits that could impact the Northern Agency chapters he represents.

In addition to Desert Rock, DPA is also looking into renewable energy projects such as a solar farm on the Big Boquillas Ranch, located 80 miles west of Flagstaff, Begay said.

Another project is a solar panel manufacturing through collaboration with companies from China, South Korea and the United States.

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