'It's Time for a Just and Equitable Transition' Dine' tell Arizona Corporation Commission
(Top photo) At the Arizona Corporation Commission in Phoenix on Monday, Lorraine Herder and Edith Simonson, Black Mesa sheepherders and weavers, carry a sign that reads, "50 YEARS OF INJUSTICE. ACC: TIME TO GIVE BACK!" Lorraine and Edith, like many elders on Black Mesa, have seen tremendous changes during their lifetime. From the disappearance of the seeps and springs in their community to the lack of precipitation today. They are here to ensure communities like theirs get the Just & Equitable Transition they need.
Black Mesa youth holding a sign that reads "FIRST COAL MINING, NOW CLIMATE CHANGE."
Nicole Horseherder holding up a piece of coal while talking about it's history and impacts on Black Mesa and in the Southwest.
Carol Davis, Diné C.A.R.E., speaking on the need for JET for coal-impacted communities.
Dan Herder, rancher/sheepherder, stands next to a 500 gallon water tank brought down from Black Mesa. Dan has seen the direct impacts of industry and climate change to his livelihood on Black Mesa. Dan hopes to see a Just & Equitable Transition (JET) future for Black Mesa as the region provided so much to power the entire Southwest for half a century.
Tribal Communities Demand Action on APS’s Just and Equitable Coal Transition Proposal Before Arizona Corporation Commission (ACC) Rate Case Open Meeting
By Tó Nizhóní Ání
PHOENIX – Beginning on Monday, October 4th, the ACC will begin the process to vote on Arizona Public Service’s current rate case. The utility has signed an agreement with the Navajo Nation that would provide nearly $150 million in support to the Tribe, as well as funding for Hopi and other non-Tribal coal-impacted communities. It also includes provisions for electrifying some of the thousands of Navajo and Hopi homes that currently lack access to electricity, and commitments for developing clean energy projects on Tribal lands.
In advance of these crucial hearings, a new report from the Empowered Transition initiative highlights the many hardships facing northern Arizona communities that already have or soon will be dealing with the economic repercussions of coal plants and mines that are being retired, or have already closed. It urges immediate action by the ACC to provide them with much needed and long overdue support.
The report compiles testimonials gathered at town hall meetings on Just and Equitable Transition held in late spring and summer, at which dozens of Navajo and Hopi Tribal members, local elected officials, business owners and residents of communities like Page and Joseph City, spoke about how coal and recent plant closures have affected their lives and how assistance is needed now. The report provides recommendations on how the Commission can blunt the upheaval of lost jobs, decreased tax revenue and community disruption.
“We’re past recognizing that utilities have a responsibility to assist the people and communities that provided the electricity and water that helped Arizona grow and prosper,” said Adrian Herder of the Navajo grassroots group Tó Nizhóni Ání, who helped organize the town hall meetings. “Navajo Generating Station and Kayenta Mine closed two years ago, and we’re still waiting for the funding and support that are needed to help rebuild our communities. We’re counting on the Commission to do the right thing and not turn their backs on the tens of thousands of Arizonans feeling the economic hardships of utility business decisions.”
WHAT: Press Conference and rally to urge the Commission to act on proposed Just and Equitable Transition support.
WHERE: In front of the Arizona Corporation Commission offices, 1200 W. Washington Street, Phoenix.
WHEN: Monday, Oct. 4, 8-11 a.m. PDT, with the press conference commencing at 8:30 a.m. sharp.
WHO: Members of the Navajo Nation and Hopi Tribe whose lives and communities have been impacted by coal and the abrupt closure of coal plants and mines, as well as Arizona ratepayers who stand in support of Just and Equitable Transition.
VISUALS: Speakers will have items of cultural significance that have been impacted by coal, mines and climate change. Supporters with signs calling for ACC action. “50 Years of Injustice, Time to Give Back”
ONLINE: The press conference will also be streamed live on Facebook at: https://www.facebook.com/tonizhoniani
In the matter of the Arizona Public Service Rate Case, Arizona Corporation Commission Docket No. E-01345A-19-0236, an agreement for Just and Equitable Transition for the Navajo Nation:
The core position of the Citizen Groups (Tó Nizhóní Ání, Diné CARE, and San Juan Citizens Alliance) since we first intervened in APS proceedings three years ago has been that APS and any other utilities or entities that have benefited from the operation of coal-fired power plants have an obligation to provide support to the Navajo Nation and coal-impacted communities as they make decisions to retire these facilities.
It is unfortunate that transition support did not come sooner given that Navajo Generating Station (NGS) closed down a year ago and that the plant’s owners knew as early as February 2017 that retirement was coming. The delay in getting to this point has caused unnecessary economic hardship for the Navajo Nation, the Hopi Tribe and other coal-impacted communities.
In this rate case, we have submitted detailed testimony regarding the need for a Just and Equitable Transition as it relates to each of the three coal-fired power plants in which APS has ownership – NGS, Four Corners Power Plant (FCPP) and Cholla Power Plant – and the communities that have been or will be harmed by their closures. To date, APS has been reluctant to even consider NGS as part of the transition conversation. While this proposal is an effort to finally begin addressing a long overdue commitment to Just and Equitable Transition, we feel that it fails to acknowledge the economic impact of NGS’s retirement on the Navajo Nation and the communities of LeChee and Black Mesa in particular. As such, we view the dollar amount offered as significantly below what is needed to support the communities that fueled APS’s success. However, the Navajo Nation’s support of APS’s offer is something we cannot ignore and ultimately must recognize.
Of critical importance is the precedent this proposal sets for further gains on Just and Equitable Transition. As long as the agreement explicitly acknowledges that APS and its partners in NGS, Four Corners and Cholla indeed have a responsibility to assist the Navajo Nation, both financially and through other resources, in its efforts to rebuild a post-coal economy, we can accept the compromise amount agreed to officially by President Nez and the Navajo Nation leadership. We will hold APS to its promise of supporting our further efforts to use this agreement as a foundation for getting the other principals in these three plants – Tucson Electric Power, Salt River Project, NV Energy, U.S. Bureau of Reclamation, Central Arizona Project, PacifiCorp, the Los Angeles Department of Water and Power and Public Service of New Mexico – to recognize and act on their obligations to support the Nation’s just and equitable transition; as well as working on the federal level to secure potential additional financial support.
It is absolutely important that this agreement also works to secure a definitive retirement date for FCPP absolutely no later than 2031. We understand that contractual and legal obligations may prevent APS from making such a statement with respect to the other owners in FCPP, specifically Navajo Transitional Energy Co., but it is critical that APS understands that continued
operation of FCPP presents a barrier to Just and Equitable Transition for our communities on the Navajo Nation. We do not support the operation of FCPP beyond APS’s 2031 exit date from coal. We have been through this before with the retirement of NGS. Despite the 2017 announcement that the plant would retire at the end of 2019, SRP entertained offers by other companies to buy
and operate NGS for a full two years past the retirement announcement. This created a significant obstacle to the Nation’s transition to a post-coal economy. It created false hope and prevented a more aggressive move to clean energy – a move that is critical for addressing our water crisis. Because of this failure, Navajo efforts to begin transitioning away from coal are more than two years behind where they should be and 50 years behind the rest of the Country in water infrastructure development. We do not want and cannot afford to see the Navajo Nation and its enterprises continue to invest in energy where there is no market. To that end, while APS may not officially be able to set a retirement date for FCPP, we are seeking its commitment to work cooperatively, creatively and constructively with us on ways to ensure that FCPP retires when APS determines the plant’s useful economic life is over, absolutely no later than 2031 and probably before that.
1. Direct payment to the Navajo Nation of $100 million, at $10 million a year for 10 years, with the funds covered through APS rates.
The Citizen Groups support this offer. Given the vast profits that APS has reaped from the operation of these three large coal-burning power plants for many decades, we maintain the position that such an amount should be considered a minimum. This transition and equity funding must be spread across a number of Navajo communities: Shiprock, Fruitland and Nenahnezad are central for transition at Four Corners; the LeChee area for NGS; and the Holbrook area for the impending closure of Cholla in the near future. In addition, communities on the Navajo Nation associated with fuel delivery to these facilities, including Kayenta and Black Mesa, deserve to be part of the Just and Equitable Transition funding considerations by APS. We are willing to support the proposed settlement of $100 million if approved by the Navajo Nation, but the Citizen Groups stand by our testimony and that of President Nez, requesting direct just transition support of $100,000 per megawatt of peak ownership, a total of $192 million. Given the immediate needs for transition support now, and not just related to the future retirement of Four Corners, we would like APS to consider an alternate payment schedule of $20 million over five years rather than $10 million a year over a decade.
2. Commitment by APS to RFPs for 600 MW of tribal clean energy development on the Navajo Nation, with 250 MW of it to occur within two years.
The Citizen Groups support this offer. However, our goal is to ensure a complete transition of the Navajo Nation to a clean energy economy in line with the principles delineated in President Nez’s Háyoołkááł (Sunrise) Proclamation. Thus, we would like to continue working with APS on avenues to ensure that the exit of APS from FCPP results in the retirement of the plant and does not open the door for its continued operation past 2031. Similarly, we would like to work with APS to ensure that any transmission capacity
freed up by the retirement of the FCPP is dedicated solely to clean energy and does not allow for replacement power to come from coal resources, which would delay the Nation’s transition beyond coal. The continued operation of coal plants means the continued use of Navajo water for industrial use. This continues to delay the economic development and water delivery needed in Navajo communities.
3. $250,000 in economic development support to the Navajo Nation, from shareholders, for five years in the timeframe immediately before (two years) and after (three years) the final retirement date for the Four Corners plant.
The Citizen Groups support this offer. However, we believe $250,000 is low considering the complexity of the process that will be necessary to rebuild a post-coal economy. Considering the amount, the Citizen Groups would like APS to consider increasing support for economic redevelopment planning and extending the period over which the $250,000 is provided (i.e. for eight years versus five, including for the five years leading up to FCPP’s closure.)
4. Contribution of $10 million, half from shareholders and half from ratepayers, toward a fund dedicated to the electrification of homes on the Navajo Nation.
The Citizen Groups support this offer, and wish to express that the Navajo Nation’s use of this money for electrification include both line connections to the grid and/or the installation of individual off-grid solar and storage projects, whichever is best for the specific circumstances of the homes being provided with electricity.
5. Extension, at no cost, of electrical lines to homes within 2,000 feet of an APS distribution line, and possibly up to 4,000 feet depending on the results of an electrification/grid connection census of homes on the Navajo Nation to be completed by APS.
The Citizen Groups support the consideration of up to 4,000 feet informed by the to-be conducted census. As with the previous response, we would like to see APS include providing off-grid solar installations on the Navajo Nation and urge it to design and implement an offering as part of the Commission’s newly approved distributed solar policy.
6. Job reassignment for all APS workers affected by the closure of both the Four Corners and Cholla power plants.
The Citizen Groups support this element of the agreement as long as it includes guaranteed job reassignment for all APS workers at both the FCPP and Cholla plants and supports considerations and flexibility that would allow for job opportunities that would enable employees to remain as residents on the Navajo Nation.
7. A formal commitment by APS to support Navajo Nation efforts to secure any water rights associated with the Four Corners plant.
The Citizen Groups support this aspect of the proposed agreement and would also like to see it supported in the final Little Colorado River adjudication, as applicable.
8. Support from APS for efforts to secure additional just transition commitments from its co-owners and partners in each of the three plants covered by this agreement.
The Citizen Groups support this aspect of the proposed agreement.
In exchange for the above, APS is requesting:
1. An acknowledgement that this is a durable agreement for the purposes of providing just and equitable transition support related to the closure of all three power plants operated by APS on or near the Navajo Nation: FCPP, NGS and Cholla, and that the Citizen Groups will not reopen or request additional just transition support related to these three power plants in the future.
The Citizen Groups acknowledge this part of the agreement.
2. APS is seeking support from the Citizen Groups for rate recovery of its Clean Energy Tracker.
While the proposed Energy Tracker is complex, the Citizen Groups are satisfied that it provides a mechanism that ultimately could benefit the goals of transitioning the Navajo Nation to clean energy. We will support APS’s effort to implement the tracker for cost recovery.
Our support comes with the caveat that APS must strive to minimize the impact to its customers that are predicated on rate recovery. We know from our experience working in New Mexico that securitization provides a mechanism for utilities like APS to recover undepreciated assets while also creating financial resources for just transition and potentially actually lowering rates – all at the same time. We hope this dialogue can lead to developing a securitization framework in Arizona with similar just transition and rate benefits that were realized through the Energy Transition Act in New Mexico.
Visit the Empowered Transition website for more information, and transcripts and recordings from the Just and Equitable Transition Town Halls. Launched earlier this year, the Empowered Transition initiative gives voice to the individuals, businesses, workers, and Tribal community members impacted by Arizona’s transition to a carbon-free future. It is a collaboration of numerous tribal, consumer and environmental organizations.
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