Thursday, February 5, 2015

UPDATE: State Environmental, Business Groups Urge TEP to Pull Support for New Mexico's San Juan Generating Station

Posted By on Thu, Feb 5, 2015 at 11:00 AM

A coalition of state environmental, community and business groups, including the Sierra Club, Tierra Y Libertad Organization, Robert Bulechek Energy Management, Borderlands Brewing Co., Solar Possibilities Consulting, Sustainable Tucson, Casa Maria Tucson and the Sky Island Alliance, have asked Tucson Electric Power to get their hands off a New Mexico-based coal-fired power plant by the name of San Juan Generating Station. The groups would like for TEP to focus on local, clean energy solutions like rooftop solar. 

Support for the the generating station is beginning to die off as the Public Service Company of New Mexico, the owner of the plant, has admitted to serious financial issues. Earlier this month, the city of Farmington, NM, where the generating station is located, abandoned its plans to buy an increased portion of the plant due to the possible huge costs that would have become a burden to the community, a press release from the Sierra Club Grand Canyon Chapter said. Other stakeholders have also pulled their support. 

TEP owns half of one unit of the plant, which presents huge financial risks to local Tucson ratepayers if the utility continues its investment in the expensive, outdated coal-fired power plant, Sierra Club argued. 

“Our community faces enormous threats if TEP leads us down a path of continued reliance on coal at the San Juan Generating Station,” said Dan Millis, Tucson organizer for Sierra Club’s Grand Canyon (Arizona) Chapter. “By continuing our reliance on an expensive out-of-state coal plant, TEP is locking our community into a future of more coal and expensive rate hikes that will threaten the pocketbooks of families in our region. It’s time for TEP to protect ratepayers here in Arizona by getting out of a dirty, expensive out-of-state coal plant and investing in local clean energy such as solar.”

From the Sierra Club press release:
The future of coal at the San Juan Generating Station has grown increasingly uncertain in recent weeks as more costs and challenges continue to arise, including the uncertainty of where the plant will get its coal after 2017. Last month, TEP in Arizona announced that it would not purchase the San Juan coal mine that supplies the San Juan Generating Station. In addition, PNM announced that the total bill for their plan to increase reliance on dirty coal and other expensive fuels had jumped by over $1 billion, with those costs likely being passed onto local ratepayers. This comes just weeks after PNM introduced a rate proposal that if approved would result in nearly a $10 per month increase to the average residential home bill due to utility’s plans to continue burning coal at the plant for the foreseeable future.

“The Watershed Management Group supports divestment from coal-fired power generation in order to prevent additional financial burden on communities from short and long-term health and environmental impacts due to air and water pollution from mining coal and energy production,” said Watershed Management Group Program Manager Kieran Sikdar.

“At a moment when investors are becoming increasingly savvy about energy sources, opting to locate in areas that display a forward-looking, 21st century mentality, TEP needs to take steps to ensure that all its energy sources reflect sound science and ethical choices,” said Madeline Kiser with the Southern Arizona Green for All Coalition.

The local calls for TEP to divest from the San Juan Generating Station come at a critical time when the New Mexico Public Regulatory Commission recently concluded hearings on PNM’s proposal, which generated strong opposition from New Mexico faith leaders, public health groups, clean energy advocates, environmental organizations, and more. Earlier this week, a coalition of New Mexico community groups called on the New Mexico Public Regulation Commission (PRC) to reject the plan from PNM that would extend the utility’s commitment to the San Juan Generating Station coal plant, thereby threatening the health and financial security of New Mexico families across the state for years to come.

"In addition to increasing the cost of electricity, we must not forget the many hidden costs of burning coal in our communities,” said Dr. Barbara Warren with Arizona Physicians for Social Responsibility. “These include the health care and human costs of asthma, chronic lung disease, and cardiovascular diseases associated with coal emissions exposure, the risks of birth defects and neurological diseases in children who are exposed to coal ash produced by burning coal, and our health insurance and lost work day costs which increase with the rising incidences of these illnesses."

"Coal pollution in the Four Corners harms our climate, local families, and endangered species," said Taylor McKinnon with the Center for Biological Diversity. "The time to transition to clean, renewable energy is now."
(Added after publication):

After posting this, I received an email from Pahl Shipley, director for integrated communications at PNM. He said there was an error in the Sierra Club press release and he wanted to clarify it.

From his email:
The record from the hearing in the San Juan case is clear and refutes the claims of miscalculations and errors and a $1 billion in increased costs to customers. It's a sensational number, but it's not true. There was one error in an assumption estimate used to compare scenarios, which we corrected well before the hearing started, communicated to all parties, and filed with the commission weeks before the hearing began. PNM made no announcement about increased costs. It's also important to note that adjustments made to the 20-year estimates were a normal part of the process and this did not affect the estimated cost to customers.

At the end of the day the facts show that PNM's plan is still the most cost effective for our customers. It would also provide the most balanced portfolio, and balances keeping the lights on, cost, environmental protection, and the risks associated with relying too much on any one generation source. And here's the truth- PNM's plan proposes a significant net reduction in coal- about a 50 percent cut for the plant and 30 percent for PNM. The company wants to replace the retired power with cleaner resources, including natural gas, emission-free nuclear that PNM already owns (in Arizona), and new solar generation. And the plan would put New Mexico well down the road toward complying with the proposed federal Clean Power Plan, and could help TEP and Arizona as well.

While indeed there are groups that oppose the plan for San Juan Generating Station, there are also important that support it, including the EPA, New Mexico Environment Department, New Mexico Attorney General's Office, the staff of the New Mexico Public Regulation Commission, The New Mexico Industrial Energy Consumers, the President of the Navajo Nation and several Navajo Chapter leaders.

We respect the opinions of those who may not agree with PNM's position. However, the debate about our energy future must be based on facts. It's unfortunate that some opponents insist on promoting misinformation in an attempt to sway public opinion.

PNM is bound by facts and required to do business in a very public, very transparent manner. Virtually everything we do is regulated and must be approved by the NMPRC in public documents and open proceedings.

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