Navajo Generating Station's Future

By Arizona Farm Bureau's Joe Sigg: With respect to the Navajo Generating Station, I feel a little like Rip Van Winkle.  Wasn’t it just yesterday, we were lobbying and writing pieces and testifying before Congress as to the importance of this facility?  And then we go to sleep, and seemingly the next morning we find the determination to close it.

(Photo Courtesy of San Diego Shooter)

As we understand the issue, commodity prices for power production from natural gas are much more favorable than from coal.  We understand it.  We frequently have situations where we are growing a given commodity and we find another to be much more profitable.  So we park some of our machinery, thinking we may get back to the original commodity if the markets change.

The analogy abruptly ends right there, because the experts say the facilities cannot be used for some sort of conversion to natural gas or solar.  So the operation will be shut down and dismantled, as will the coal mine that supplied the facility.

We see wax and wane in the same policy.  There is, on the one hand, the promise of lower power and water costs, which might [I say might] find their way into the bottom line for central Arizona farmers and their irrigated farmland.  The downside is the impact on the reservation.  Frequently we see a rising economic policy that benefits people broadly, but the costs are borne by a few, and that is certainly the case here.

Markets are often said to have rough justice and economic decisions do not factor in all of the costs – it is just a decision of the market.  There are potentially 3000 good paying jobs on the line with this decision – that is very rough.  The point being what appears to be an easy market decision has a cascade of other consequences, and they will not be easy to address.

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