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Down and Dirty

Opponents of the Desert Rock Power Plant say it's time to get over coal

December 17, 2008, 12:00 am

From his office at the Bracewell & Giuliani law firm—yes, that Giuliani—in Washington, DC, spokesman Frank Maisano gets fired up when asked about New Mexico’s opposition to the project.

Maisano points out that Gov. Richardson didn’t announce his opposition to the project until 2007, years into the project’s planning process—and far too late to affect the project’s design.

In July 2007, the governor announced he was “concerned” about the plant and said that Desert Rock, as proposed, would be a step in the wrong direction. According to Richardson, any new coal plants built in New Mexico should employ what’s called integrated gasification combined cycle (IGCC) technology.

IGCC technology allows for carbon emissions to be separated from other pollutants and placed in a separate stream, which can then be channeled underground. Rather than releasing the carbon dioxide into the atmosphere, where it affects climate change, it can be captured and retained under the earth.

At the time, Richardson also said only plants that can capture at least 60 percent of carbon emissions will be eligible for state tax breaks.

“You know it really kind of bothers me—and the governor, I know, is going to be the commerce secretary, so he’s leaving New Mexico, and Attorney General [Gary] King has been an active and aggressive opponent in the last year—but for three years, the governor never mentioned one word, ‘boo’,” Maisano says. “The state didn’t take much interest in it for the first two, three years of the project, and in fact were somewhat supportive.”

Asked how the governor feels about the plant and how it might affect some of the steps the state has taken to reduce carbon emissions, the governor’s director of communications, Gilbert Gallegos, writes in an e-mail, “I don’t have anything new to say about it.”

While it may be true the state didn’t actively oppose the plant until recently, the New Mexico Legislature has not yet bowed to the company’s attempts to find tax relief for the project. In fact, for three years running, the Legislature has denied Desert Rock Energy Company’s requests for help building the plant.

It remains to be seen if a fourth attempt will be made by proponents of the project. While activists say they will watchdog lobbying attempts, Maisano casually dismisses the idea that he or others will come pound the pavement in Santa Fe.

“We don’t need anything,” he says, but then adds: “It would be great if the state Legislature would step up to the plate—like the Navajo Nation and San Juan County—to work with us to develop a tax structure that would fit the size and magnitude of the project.”

But State Sen.-elect Peter Wirth, D-Santa Fe—who, as a representative, consistently opposed Desert Rock’s requests for tax relief—says no companies should be counting on economic development incentives right now.

“Now, we are in a totally different revenue situation, with a $454 million shortfall for this fiscal year, and lots of instability in the [coming] years so, from a general perspective, any of these types of tax cuts to encourage economic development are going to be looked at in a different light,” he says. “Over the last six years, Gov. Richardson has eliminated about a billion dollars from the tax base. So when we have volatility like this with oil and gas, it creates this situation we’re in now—and the Legislature as a whole is going to look with a lot more scrutiny at tax proposals coming in.”

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