Los Angeles Department of Water and Power Approves Sale of City’s Share in Navajo Generating Station

By: Nikke Alex | Intern
Theodore J. Griswold | Partner | ted.griswold@procopio.com

Last week, the Los Angeles Department of Water and Power (LADWP) Commissioners approved a sale of the city’s share of the Navajo Generating Station to the Salt River Project. As a part of the agreement, LADWP pushed for an early retirement of one of the three 750 megawatt units at NGS. However, the early retirement of the unit was not an explicit condition of the sale.

The NGS, a 2,250 megawatt coal-fired power plant, is located on the Navajo Nation near Page, Arizona. For more than 50 years, NGS has supplied electricity to customers in California, Arizona and Nevada, yet many Navajo homes lack running water and electricity. NGS also supplies electricity to pump water through the Central Arizona Project (CAP) – the largest aqueduct system in the United States. The CAP supplies water to nine tribal communities in Arizona and New Mexico. The stake holders of NGS are now the U.S. Bureau of Reclamation, Salt River Project, Arizona Public Service Company, Nevada Power Company, and Tucson Electric Power Company.

In 2013, former Los Angeles mayor, Antonio Villaraigosa, announced Los Angeles will phase out electricity supplied by coal by 2019. Currently, LADWP purchases electricity from NGS in Arizona and Intermountain Power Project in Utah. LADWP owns a 21.2% share of NGS but does not own a share of the Intermountain Power Project.

Since NGS is located on tribal land, the site lease is contingent upon Navajo Nation Council approval. In 2013, the Navajo Council and Navajo President approved a lease extension through 2044 despite community concerns regarding air quality and public health. The issues surrounding NGS have been complex. Since municipalities and cities demand energy and the CAP requires electricity to supply water to Phoenix and Tucson, the Navajo Nation lease with NGS fuels the Navajo Nation with much needed predictable revenue, and NGS helps the U.S. federal government fulfil Indian water-rights settlements. As large cities are transitioning to cleaner energy sources, utility operational plans should include a strategy to transition to cleaner energy sources in order to end reliance on the coal-fired NGS that is powered by coal extracted from Navajo lands.

Nikke Alex is a citizen of the Navajo Nation and is entering her third year at the University New Mexico School of Law. Nikke was the former Executive Director of the Black Mesa Water Coalition, an environmental justice non-profit that worked to replace coal-fired power plants with renewable energy. Nikke is a recipient of the 2015 Procopio Native American Internship.

Ted is head of the Native American Law practice group and primary editor for the Blogging Circle. Connect with Ted at ted.griswold@procopio.com and 619.515.3277.