Published December 21, 2015
SHIPROCK, NEW MEXICO – Navajo Transitional Energy Company, LLC (NTEC), a business enterprise of the Navajo Nation, announced on Monday that NTEC will proceed with an option to acquire partial ownership of the Four Corners Power Plant – a move that further solidifies the Navajo Nation’s position as a leader in energy development in Indian Country.
“NTEC is positioning to move into the power generating industry. This acquisition would enable NTEC to bolster Navajo energy security and to be at the forefront of innovation and progress. For the first time, Navajo power will be generated for the Navajo people,” said Steve Gundersen, NTEC board chairman.
NTEC owns Navajo Mine and supplies coal for the Four Corners Power Plant. Both operations are located on the Navajo Nation near Farmington, New Mexico.
Navajo Nation Council Speaker LoRenzo Bates views the option for partial ownership as an opportunity.
“This is an opportunity for the Navajo Nation through one of its enterprises to gain partial ownership of a well-established entity that has produced power since the 1960s. This opportunity puts the Navajo Nation as a leader in Indian Country for energy development,” said Bates, “The operations have proven to be reliable sources of revenue for the Navajo Nation.”
In 2014, NTEC contributed approximately $37 million to the Navajo Nation in coal taxes and royalties. The mine and power plant employ nearly 700 people, most of whom are Navajo.
As part of NTEC’s coal sales agreement with Arizona Public Service (APS), the operating owners of Four Corners Power Plant, NTEC has an option to purchase seven percent of the power plant, representing about 107 megawatts of the plant’s output. NTEC formally notified APS about plans to exercise the option on December 18, 2015.
The seven percent ownership interest is currently owned by El Paso Electric. The Texas-based utility plans to divest their interest from the plant.
NTEC expects to close the acquisition of the seven percent ownership interest by July 2016.
NTEC’s Board of Directors approved the acquisition of the seven percent interest during a special meeting on December 18, 2015.
“This transaction is an important strategic step for NTEC. By acquiring the seven percent interest, we enhance our relationship with our customer, the FCPP. In addition, we strengthen NTEC’s ability to fulfill its mission to transition the Navajo economy to a cleaner, more renewable energy future and reinforce our commitment to building the Nation’s economy,” said Gundersen added.
One of NTEC’s roles will be working with APS and other power plant owners with installing emission reducing technology, selective catalytic reduction (SCR) equipment, on the two units at the Four Corners Power Plant. The installation of the technology is expected to start in 2017.
“We understand that energy production has to continually become more clean and efficient and we look forward to the possibilities of working closely with APS and other power plant owners to raise the standard of cleaner energy production on the Navajo Nation. Coal based power is still one of the most reliable sources of energy in the world,” said Clark Moseley, NTEC CEO.
When the Navajo Council created NTEC, the Council mandated that NTEC shall invest and re-invest no less than 10 percent of its available net income into the research and development of renewable and alternative sources of energy, storage, and transmission technologies and facilities.
Moseley said NTEC plans to use the experience as a partial owner to help strengthen future clean energy projects mandated by NTEC’s charter.
“Coal is being used as a gateway into realizing energy producing projects on the Navajo Nation. As we look forward, the experience that could be gained from being a partial owner of a power plant could prove to be invaluable to the future success of NTEC energy projects,” Moseley said.