SRP rejects amended lease agreement for Navajo Generating Station

May 09, 2013

There is a dispute brewing over a lease agreement for a coal-fired power plant that provides electricity to millions of people in Arizona, California and Nevada. A co-owner of the plant is at odds with the Navajo tribe over water rights and other issues.Salt River Project, Tucson Electric Power and other utilities that own the Navajo Generating Station in northern Arizona want to negotiate a new lease with the tribe, but when the Navajo Tribal Council approved a lease extension last week, it changed the agreement so the tribe would get expanded water rights. The Navajo Nation also wants the U.S. Bureau of Land Management to sign on to the lease.

SRP spokesman Scott Harrelson said that’s not acceptable.

“Certainly this is a very critical piece that needs to be resolved so that we can keep this a very important Arizona resource in operation beyond 2019," Harrelson said.  

Harrelson said it is up to the Navajo Nation to come back to SRP with another lease proposal.

The future of the power plant remains uncertain. The EPA is pushing the plant to install expensive new clean air technology, and some major utilities in California and Nevada announced they will stop purchasing coal power from the plant in the next few years.

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