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Mohave Power Plant Operation Future in Dark 

Story by Bernie Woodall, Reuters News Service11.10.05

LOS ANGELES - An agreement could be near on coal and water supplies
needed to keep the 1,580-megawatt Mohave power plant in Nevada open
past Dec. 31, but even if such accords are reached, the outlook for
uninterrupted operation of the plant is murky, several parties involved
said.

Southern California Edison, the operator and majority owner of the
coal-fired plant near the intersection of Nevada, California and
Arizona, is close to agreement with two Native American tribes and the
world's largest private-sector coal company regarding coal and water
supplies, said Wayne Taylor, chairman of the Hopi Tribal Council.

"We are very close to a settlement," Taylor said. "In fact, we hope to
have this settlement in hand by the end of the year."

But even if the parties can agree, the plant will shut at least
temporarily at year's end unless three environmental organizations can
be convinced to push back a deadline for So Cal Ed to install about $1
billion of upgrades to Mohave's pollution control system.

Involved in coal and water talks are representatives for So Cal Ed, a
subsidiary of Edison International, the Navajo Nation, the Hopi Tribal
Council, Peabody Energy Corp. and the Salt River Project, an Arizona
public utility and behind So Cal Ed, the second-largest owner of the
Mohave power station.

The three environmental groups -- Grand Canyon Trust, Sierra Club, and
National Parks Conservation Alliance -- have a court-sanctioned consent
decree in hand that was reached in 1999 ordering the plant to shut
unless the pollution upgrades were in place by Jan. 1, 2006.

With less than two months until the plant's possible shutdown, So Cal
Ed is likely going to seek an extension to the deadline from the
environmental groups, Taylor said.

So Cal Ed officials would not comment whether it would try to change
the deadline.

"Any request to extend the deadline is a nonstarter," said Roger Clark,
air and energy director for the Grand Canyon Trust, based in Flagstaff,
Arizona. "We've allowed them to violate the law for some time now. (Any
request) would have to be quite compelling."

A So Cal Ed spokesman said that the company did not wish to pursue the
upgrades while the coal and water issues were not solved.

"SCE is working hard on all reasonable options that could make possible
the continue operation of the plant," said Southern California Edison
in a statement. "At this time, it appears likely the plant will shut
down for some period on Dec. 31, 2005, but we hope to minimize any such
shutdown."

But Clark of the Grand Canyon Trust said the company has had years to
fix the water and coal supply issues. He pointed out that So Cal Ed
wanted to sell the plant and when it entered the consent decree did not
think it would still have to deal with Mohave by 2005.

In a unique situation, Mohave runs on coal that is shipped by pipeline
273 miles from the Black Mesa mine owned by Peabody and on land owned
by the Navajo and Hopi. The coal is shipped by crushing it and then
mixing it with water to create a slurry that is then shipped via the
pipe to the power plant near Laughlin, Nevada.

The two tribes say the underground aquifer source of the water Peabody
is now using needs to be preserved for their drinking supply. An
alternate aquifer -- also under land owned by the tribes -- can be
used, but a 100-mile pipeline will have to be constructed.

Taylor of the Hopi tribe said So Cal Ed has agreed to pay $200 million
to build the new pipeline, but company officials declined to confirm
that.

Taylor said the Hopi can agree to allow Peabody to use the current
water source until the new pipeline is built.

Clark said the owners of Mohave "have had six years" to renegotiate
water and coal rights with the Navajo and the Hopi and with Peabody.
The coal and water rights agreements were set to expire at the end of
2005 long before the environmental groups filed suit against Mohave's
owners in 1997, Clark said.

Peabody, the biggest nongovernmental coal company in the world, is a
major employer of both tribes, which have unemployment rates of 50
percent or more.

In addition to So Cal Ed's 56-percent ownership of the Mohave station,
owners are the Salt River Project (20 percent), Las Vegas-based Sierra
Pacific Resources Corp.'s Nevada Power Co. (14 percent) and the Los
Angeles Department of Water and Power (10 percent).

Story by Bernie Woodall

REUTERS NEWS SERVICE

http://www.planetark.com/dailynewsstory.cfm/newsid/33399/story.htm