Mohave Proposal Gets Mixed Reaction

Oct 02 - Las Vegas Review - Journal

John Kennon, a Laughlin area resident who retired from the closed coal-fired power plant there, wonders why Nevada officials want to build another one near Ely.

"Seems too bad that a multimillion-dollar power plant sits rusting ... in Laughlin while another is being built in Ely," Kennon, 59, said in an e-mail. "Too bad Nevada Power and Southern California Edison could not figure out to put a working power plant back in service. I hope the lights stay on."

Thanks to Salt River Project, a public power company serving Phoenix, the 1,580-megawatt Mohave Generating Station may start cranking out electricity again in a few years.

Salt River this week announced that it is looking for partners willing to help it restore Mohave to service. Restoration would cost about $1.1 billion including $500,000 for pollution-reduction equipment. John Coggin, the utility's manager of supply and trading, said former employees of the Laughlin plant would be attractive job candidates if Salt River is successful in reopening the plant.

Salt River has drawn mixed reactions to its proposal. Nevada Power Co., which is seeking regulatory approval for a $3.7 billion coal-fired plant in Ely and related transmission line, is not interested in partnering in Mohave, said spokeswoman Andrea Smith.

"We don't believe it's economically feasible to restart (Mohave)," Smith said.

But Arizona Public Service of Phoenix and Tucson Electric Power of Tucson, shown interest in the Mohave project.

"As part of our commitment to provide customers with reliable and affordable electricity, it's prudent for us to evaluate any potential source of generation that might help us meet the energy needs of our growing population," said Mark Fallon, a spokesman for Arizona Public Service.

"As an active participant in the market, APS would always be interested in purchasing competitively priced power from operating power plants," Fallon said.

Joe Salkowski, a spokesman for Tucson Electric Power and its parent UniSource Energy, said his companies have discussed the project with SRP.

"And we may have an interest in participating in some way, but we haven't committed to any determination of what would be appropriate," he said.

Tucson Electric could sign a long-term contract for power from Mohave or it could join Salt River as a partner.

Southern California Edison and the Los Angeles Department of Water and Power, like Nevada Power, have said they were no longer interested in restarting Mohave.

"Although SCE is no longer pursuing a return to service for Mohave, we support SRP's efforts to find a new ownership group," Edison said.

Salt River proposes to buy coal from Navajo Nation and Hopi Tribe .

Edison, Nevada Power and other owners of Mohave closed the power plant at year-end 2005 when they failed to negotiate agreements with the American Indian tribes for coal and water needed to ship the coal by slurry line. Under an agreed federal court judgment with environment, the Mohave owners promised to install pollution control equipment or shut it at that time. The Laughlin power plant employed 345 workers.

An industry insider, speaking on the condition of anonymity, said it was logical for Salt River to pursue opportunities for Mohave, given the explosive growth of power demand and longer time needed to develop a new power plant. The source said power use in the southwestern United States is increasing by 1,000 megawatts every year, but utilities are reluctant to build more plants that rely on volatile-priced natural gas.

"We're behind, and it's going to be hard to catch up," he said. The source said utilities will be inclined to consider Mohave if it proves feasible to reopen the plant.

However, the plant owners would need to get an extension on Mohave's contract for an allotment of water from the Colorado River in order to continue operations beyond 2026, he said.

Kennon, who retired from Mohave 10 years ago at age 49, said he would go back to work at Mohave "if the money is there."

He added: "Guess my next question should be, 'Who do I contact for a job?' "