Updated 

NV Energy proposes closing coal-burning plant early

Correction
04/17/13 -- CLARIFICATION: In an April 4 story about NV Energy’s plans to close its coal plants, a company spokesman incorrectly explained the projected rate increases needed to pay for transition to natural gas and renewable energy production. NV Energy says it will need rate increases of 1.65 percent per year for 20 years, on average, to pay for the conversion. That would compound to a 38.7 percent rate increase over 20 years, but the utility says its rates would go up by 34.4 percent over 20 years if it did not close coal plants early.

NV Energy has floated a plan to shut down a power plant 50 miles northeast of Las Vegas as part of a statewide move away from coal.

The proposal unveiled Wednesday calls for the utility to retire three of the four units at the Reid Gardner Generating Station next year and shutter the plant entirely by 2017, six years earlier than previously scheduled.

NV Energy CEO Michael Yackira said the decision came down to a choice between investing in newer, longer-lived plants with lower emissions or continuing to upgrade and maintain older plants.

He believes the transition from coal to renewable and natural gas facilities will be better for customers and help “make Nevada the focal point for the nation” for clean energy production.

The announcement drew a guarded reaction from Moapa Paiute tribal members and environmentalists who have fought the coal plant for years.

“I’m glad to see it winding down. This is a great step for the tribe,” said William Anderson, chairman of the Moapa Band of Paiutes. “It’s a shock for us. I’m still a little skeptical.”

Elspeth DiMarzio, who represents the Sierra Club in Nevada, hailed NV Energy’s decision to speed up the closure of Reid Gardner but said shutting down the plant will solve only part of the problem.

“It’s also really important to look at the remediation and cleanup of the coal ash dump” at the plant, DiMarzio said.

Tribal members living in the shadow of Reid Gardner’s smokestacks have blamed pollution from the plant for illnesses and deaths on their 73,000-acre reservation.

No health studies have linked medical problems among the tribe’s roughly 300 members to the power plant next door, but Anderson said research is under way that could change that.

“It doesn’t seem like a coincidence that so many people passed away on this reservation and most of them were living so close to the power plant,” said Anderson, who grew up next to Reid Gardner and thinks the facility contributed to allergy problems he developed later in life.

Anderson and Yackira spoke on the phone Wednesday in a call Rep. Steven Horsford, D-Nev., said he facilitated.

“The conversation was frank, and NV Energy expressed that they value the Moapa Tribe, their role in the community, and hope to build trust for future collaboration,” Horsford said in a statement praising the utility’s decision.

“Our state can lead the green economy, but we need to make the right choices and investments. The decommissioning of coal plants is a smart first step.”

NV Energy also plans to stop drawing power from the Navajo coal-burning plant in northern Arizona, relinquishing its ownership stake in three units there by 2019 instead of 2026.

The utility’s only other coal-burning plant in Nevada, the North Valmy Generating Station near Battle Mountain, is scheduled for retirement in 2025.

NV Energy plans to replace power from coal with renewable energy projects and increased use of natural gas for generation. The state’s largest electric utility owns 10 power plants in Nevada; seven are fueled by natural gas.

NV Energy officials outlined their emission reduction and capacity replacement plan, which they call NVision, during energy-related testimony Wednesday before the Legislature .

On a day when the Dow Jones industrial average lost 112 points, shares of NV Energy gained 25 cents, or 1.24 percent, to close at $20.36. About 6 million shares were traded, nearly three times the normal volume.

The utility expects to submit its plans to the Public Utility Commission of Nevada within a year. The PUC would have 210 days to review and approve the retirement of power plants, the construction of new ones and other aspects of the transition away from coal.

The commission also will consider rate increases — 3.84 percent a year for 20 years, on average — NV Energy expects to need to help pay for the conversion, which could generate as many as 4,700 construction jobs and 200 operation and maintenance jobs.

Anderson said the tribe and its neighbors welcome such employment opportunities, but they don’t want to see the coal-burning plant replaced with a natural gas-burning one.

The tribe is in the midst of developing a solar array on reservation land to sell power to the city of Los Angeles.

Anderson said tribal members will mark Earth Day this month with a march from the reservation to the solar project site along Interstate 15 .

Now they have something else to celebrate: the possible closure of the coal plant that has loomed over their homes for almost 50 years.

“I’m a little cautious right now, but it’s exciting news,” Anderson said.

NV Energy’s announcement comes a month after the Moapa Band of Paiutes threatened to sue the utility over phony air pollution data submitted to regulators by a Reid Gardner contractor.

The tribe bases its claim on documents showing the Nevada Division of Environmental Protection had to discard about five years of dust pollution data for one monitoring station at the power plant when a 2011 investigation determined the information was logged incorrectly by the contractor.

Regulators and the utility have downplayed the significance of the faulty data, which they said was not used to determine whether the facility was in compliance with clean air standards.

Contact reporter Henry Brean at hbrean@reviewjournal.com or 702-383-0350.

 

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