Even ignoring for a moment its pending appeals and litigation—and the long permitting process necessary for any project the magnitude of a coal-fired power plant—Desert Rock’s future does not appear set in stone.
Current cost estimates for the plant hover around $4 billion, up from $1.5 billion five years ago—and questions still remain about from where that money might come.
After Sithe’s primary investor, The Blackstone Group, went public last year, its stock value plummeted by 75 percent. In November, the company reported a $502.5 million loss in its third quarter. And while spokesman Maisano is optimistic the tribe will pony up between 25 and 49 percent of that cash, it remains to be seen how realistically a tribe with a 44 percent unemployment rate and a median family income of $11,885 can muster up a few billion dollars to actually build the plant—never mind the transmission line needed to actually move the electricity off the reservation. It’s possible, Hardeen says, that Navajo Nation President Shirley will again request help from the federal government.
Hardeen indicates the belief that the tribe is not being cut a fair deal from the government. He points out that three years ago, Shirley requested a $1 billion loan from the federal government. But no one took him seriously, Hardeen says. “And here we have the $700 billion [bailout] and the auto industry looking for a bailout and it’s actually happening,” he says. “The Navajo Nation and Indians have had these economic needs historically, and people seem to be thinking, ‘This is the way the Navajo want to live.’ But it’s not.”
Additionally, while no one knows yet how the Obama administration—working in partnership with a Democrat-controlled Congress—might tackle the issue of greenhouse gas emissions, major policy shifts are likely as climate change becomes a more pressing policy issue.
While US Sen. Pete Domenici, R-NM, actively supported Desert Rock, US Sen. Jeff Bingaman’s spokesperson Jude McCartin emphasizes that Bingaman cannot affect the project’s process or progress.
All he can do, she says, is enact legislative provisions to help make plants cleaner and reduce carbon emissions—something he was committed to even during the Bush administration.
According to McCartin, Bingaman is actively working to make carbon capture an economically viable option for companies seeking to build coal-fired power plants. He recently worked to pass two separate laws aimed at reducing emissions from coal-fired power plants.
The first law creates an investment tax credit for the deployment of carbon capture technology (that is, separating the carbon out and placing it in the ground.) The second law, McCartin says, offers a tax credit to companies that actively capture and use that carbon, which can be liquefied and put to other uses. “It’s more costly to do what’s right,” she says, and such incentives will level the playing field and encourage companies to use new technology.
Marissa Padilla, spokeswoman for US Sen.-elect Tom Udall, notes, in an e-mail statement, that while Desert Rock is currently bogged down in litigation, “If this project once again begins to move forward, it would be an opportunity to bring about desperately needed economic development and job creation to the Navajo Nation. However, if it does proceed, Senator-elect Udall believes the proposed power plant should be a model plant for the rest of the nation by using the most advanced, carbon reducing technologies available.”
Additionally, a recent ruling from the Environmental Protections Agency’s appeals board—the same one to which the state is appealing Desert Rock’s air quality permit—may make it harder for companies to build coal-fired power plants now and in the future.
In November, the board rejected a permit the agency had previously issued for a coal-fired power plant on the Uintah and Ouray Indian reservation in Utah, saying the EPA had failed to comply with a 2007 Supreme Court decision that requires carbon dioxide be regulated under the Clean Air Act as a pollutant. The company will now have to reevaluate its project, bearing in mind how to best control carbon emissions, and resubmit its permit application to the EPA.
Finally, even if Desert Rock jumps through the pending bureaucratic hurdles, it will still have to grapple with a wall of opposition on Navajo land.