The Navajo Generating Station (NGS) in northern Arizona will help contribute nearly $13 billion to the Navajo economy and help support thousands of jobs from 2020 through 2044 — if agreements can be reached to keep the plant operating beyond 2019, according to a study prepared for the Navajo Nation and Salt River Project (SRP) by the L William Seidman Research Institute at the W.P. Carey School of Business at Arizona State University.
Located on the Navajo Nation, NGS is one of the largest and most important suppliers of electricity in the Southwest.
According to the report, “Navajo Generating Station and Kayenta Mine: An Economic Impact Analysis for the Navajo Nation,” the plant’s coal supplier will contribute $12.94 billion to the Navajo Nation economy through sustained jobs and wages if the plant is to remain operational through 2044.
NGS employs about 518 people, nearly 86 percent of whom are Native American. The Kayenta Mine has more than 400 employees, about 90 percent of whom are Native American.
“I have been saying we need to protect existing jobs on the Navajo Nation,” said Ben Shelly, Navajo Nation president. “This study shows that the plant and the mine not only support existing jobs at the plant and mine but support other jobs in the area.”
The report examines the direct, indirect and induced economic impact of NGS and Kayenta Mine on the Navajo Nation using the IMPLAN model employed by Arizona to examine economic projections. The study examines the economic effects exclusively for the Navajo Nation.
Despite the economic importance of NGS, a number of significant challenges threaten its future viability. To ensure future operations of NGS, the plant’s lease and rights of way with the Navajo Nation must be extended and the coal supply contract with Peabody Energy renegotiated prior to any additional costly emission controls from the Environmental Protection Agency (EPA).
The plant’s lease and rights of way with the Navajo Nation are set to expire around 2019, and the Navajo Nation Council is considering legislation to extend them. The plant’s owners also are renegotiating the coal supply contract with Peabody Energy. The EPA has proposed additional, costly environmental rules to address regional visibility.
NGS is a coal-fired power plant that provides electricity to customers in Arizona, Nevada and California, and energy to pump water through the Central Arizona Project. The participants in NGS include the plant’s operator, SRP; the U.S. Bureau of Reclamation; Arizona Public Service Co.; Los Angeles Department of Water and Power; Tucson Electric Power Co. and NV Energy.