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Updated Apr 11, 2013 - 6:49 pm

Navajo takes up lease renewal for coal power plant

FLAGSTAFF, Ariz. -- Navajo lawmakers considering legislation to extend the lease for a coal-fired power plant were greeted Thursday by coal miners and plant workers hoping to stay in business. Meanwhile, critics of keeping the Navajo Generating Station near Page running were urging the lawmakers to put another stop to the bill.

The Tribal Council's committee of the whole narrowly rejected the measure that previously was ruled out of order, but that doesn't prevent it from being placed on next week's spring session for a final vote.

Navajo lawmakers clearly are divided on whether to approve a 25-year lease for the power plant that will expire in 2044. The agreement would increase annual payments to the Navajo Nation from $3 million to more than $40 million a year.

The power plant's operator, the Salt River Project, recognizes the mounting challenges.

The U.S. Environmental Protection Agency has proposed pollution controls that would reduce haze-causing nitrogen oxide emissions by 84 percent but that could cost more than $1 billion. One of the power plant owners in California is looking to sell its share, and another in Nevada recently denounced coal as a future energy source.

Scott Harelson, a spokesman for SRP, said the already complicated process to keep the plant alive isn't getting easier. But he said the utility is committed to keeping the plant in operation. The current site lease in the hands of the Navajo Nation expires in December 2019.

``We think it's an important resource, not only to SRP customers but to the entire state of Arizona,'' he said. ``It's water, it's jobs, it's economic impact. There's a lot riding on this facility.''

Navajo Generating Station provides power to a series of canals that deliver water to Arizona's major metropolitan areas and ensures that American Indian water rights settlements are fulfilled.

A study released this week found that the power plant and its sole provider of coal, the Kayenta Mine, will contribute nearly $13 billion to the Navajo economy between 2020 and 2044. The study conducted by researchers at Arizona State University's business school was done at the request of the Navajo Nation and SRP.

About 65 of the power plant's employees, and more than 150 workers from the coal mine showed up at the council chambers Thursday in Window Rock.

Environmentalists have argued that the power plant is dirty and want the owners to transition off coal. They also believe the Navajo Nation isn't getting the best deal possible under the lease extension.

Lawmakers on Thursday didn't discuss the issue that stalled the legislation in February. The measure was taken off the agenda after lawmakers questioned whether the team that negotiated the extension was recognized under tribal law and should have included Tribal Council delegates.

In a memo issued late last month, Navajo Attorney General Harrison Tsosie said a negotiating team established by the now-defunct Advisory Committee never was recognized formally by the full Tribal Council, and went unfunded and unstaffed, rendering it inoperable. Tsosie said the Navajo president had the authority to assemble a negotiating team for the lease extension.

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