Mohave Valley Daily News
July 21, 2003
Sarah Kahne

LAUGHLIN - Employees at Mohave Generating Station continue to remain in limbo over the closure of the plant. The future of MGS no longer seems viable as more issues continue to crop up that will keep the power plant from continued operation after 2005. There is a possibility that the power plant would be able to reopen in 2009 if all pending issues were resolved by that time.

Not only is the power plant saddled with expensive renovations mandated by a court settlement reached with the Grand Canyon Trust, the Sierra Club and the National Park Service, but also faces losing water rights to the Colorado River, water supplied by the Hopi Tribe and a coal contract with the Navajo and Hopi. MGS is also involved in litigation with the Navaho Nation over past contracts and perhaps past monies allegedly owed to the Tribe.

The California Public Utilities Commission is required to authorize the expenditure for repairs and has conducted hearings that will determine the fate of the plant after 2005. A decision regarding the expenditure has yet to be made, but is expected soon.

"We are waiting for the PUC to make a determination. We are continuing to negotiate and work on this, but every day time continues to run out," said Don Hendren, MGS director of community affairs.

According to Hendren, the main issues include the water supply that will be used for the transport of the slurry, the renewal of the coal contracts, the CPUC decision to allow the expenditure needed for upgrades at the plant, the construction and completion of those upgrades and a coal permit for Black Mesa Mine.

According to testimony rendered by Hopi Chairman Wayne Taylor to the California PUC, the tribe can no longer allow the use of water from the N-aquifer to be used by MGS for the slurry pipeline.

"The N-Aquifer, pure, pristine water deposited during the last ice age, is the Hopi Tribe's sole source of drinking water. In addition, the N-Aquifer water plays a central role in Hopi life, culture and religion,"Taylor said. "The Hopi tribe has made it clear to Peabody Western Coal Company and the operators of MGS that, after 2005, the N-Aquifer cannot continue to be utilized as the source of water needed to slurry coal from the Black Mesa Mine to MGS and that an alternative source of slurry water must be found."

"At the same time, I must emphasize that the Tribe has a critical 35-year history and relationship with the MGS. While we have not been a formal partner of Southern California Edison in the ownership and operation of the plant, there is no question that the Tribe's economic security is fundamentally tied to the ongoing operation of the plant. Almost 30 percent of our tribal budget is dependent upon MGS derived revenues," Taylor continued.

Although it is obvious that the Hopi will not allow the continued use of their water, they have been very vocal about keeping the generating station open.

The C-Aquifer, located west of Winslow has been recommended as a new source of water.

Even if a new source is available for use by the Mohave Generating Station, new construction carrying the water to the Black Mesa Mine must be built. A 'life of mine' permit must also be obtained from the Department of the Interior for the further operation of the mine.

The permit cannot be issued until an environmental impact study is completed and according to a letter written by J. Steven Griles of the DOI, after the application is received it would take approximately 28 months to grant or deny the permit.

"It is important, either to find an alternative to N-Aquifer water for the slurry pipeline or for the various parties to agree on the continued use of the N-Aquifer. Finding such an alternative agreement appears to need to happen quickly if Black Mesa coal is to continue to be used at the Mohave Power Plant," Griles wrote.
MGS water rights to the Colorado River are tied to the use of coal from the Navajo and Hopi. Without the coal contract renewal, a new water supply source and $1.1 billion worth of retrofitting to come into compliance with the parameters set forth by the court settlement, the generating station is scheduled for closure at the end of 2005.

Hendren said the renegotiations of the coal contract are on the back burner pending the outcome of the suit filed by the Navajo Nation.

Navajos believe the initial contract should have provided royalty payments of 20 percent instead of the original 12 percent outlined in the contract.

Hendren said that the power plant would require 124 train car loads of coal per day to continue operation. He said it wouldn't be feasible because there aren't enough trucks to keep the coal coming and the plant requires coal slurry, not just coal.

"Additional spending at this time on engineering and related items is unnecessary and would have insufficient benefit in terms of reducing the length of the required outage to justify the inherent risk," said Harold Ray, executive vice president of generating at Southern California Edison during testimony on April 15, 2003.

In the meantime, it's business as usual at the power plant.

Searchlight, Laughlin and Needles continue to receive their power and the employees at MGS continue to wait to find out their fate