Hopi Tribe argues against deal for partial retirement of Navajo coal plant

The Hopi Tribe said in a Feb. 12 brief filed at the U.S. Ninth Circuit Court of Appeals that a regional haze compromise reached by the U.S. Environmental Protection Agency, the U.S. Bureau of Reclamation and others that involves a partial shutdown of the coal-fired Navajo Generating Station (NGS) should be tossed out because the tribe was not included in the negotiation process.

NGS is a 2,250-MW, three-unit plant fired by coal from the Kayenta mining operation of Peabody Energy (NYSE: BTU). The 2014 compromise being challenged by the tribe calls for one of the three units to be retired in 2019, in place of all three units having to install costly selective catalytic reduction (SCR) systems for NOX control. The remaining two units would have to achieve NOX emissions equivalent to SCR installation as of 2030. The plant is owned by various parties, including the Salt River Project (SRP), the Bureau of Reclamation and Arizona Public Service.

“The United States does not even attempt to defend the Bureau of Reclamation’s exclusion of the Hopi Tribe from the Technical Working Group (‘TWG’),” said the Hopi Tribe brief. “Rather, the United States argues that the Hopi Tribe has no judicial remedy and suggests that the Court should segregate agencies of the United States into independent and distinct legal entities and ignore or excuse the bad acts of Reclamation. Fatal to this argument is the fact that the United States cannot be so segregated. The Constitution makes plain that the executive powers of the United States are vested in a single President. And the United States—not an individual subpart thereof—is the Hopi Tribe’s trustee.

“Tribes must be able to enforce their right to consultation; the Hopi Tribe is appearing before this Court to ask that the United States be held accountable for meeting its trust obligation. There can be no question of the harm that will come to the Hopi Tribe if the Final Rule is allowed to stand. The United States recognized that early retirement of NGS ‘would seriously harm’ the Hopi Tribe’s economy. Even a partial closure of one of the units of NGS will dramatically reduce coal revenues to the Hopi Tribe, and the substantial negative impact on the Hopi Tribe should have been considered fully by the United States, both as trustee of the Hopi Tribe, as well as by the plain language of the Clean Air Act and the Regional Haze Rule. The United States’ cavalier disregard for these obligations must be corrected.

“There can be no question that the United States failed to live up to its consultation duties during its secret TWG negotiations. The United States representatives have provided varying explanations and excuses for failing to consult with the Hopi Tribe, none of which are satisfactory. For example, the main participant in the TWG for the United States was Alletta Belin, Senior Counsel in the Department of Interior Solicitor’s Office. After the TWG Agreement was made public, Ms. Belin telephoned the Hopi Chairman and told him that she thought SRP had been advising the Tribe of the TWG proceedings. Ms. Belin later stated that she was prohibited from discussing the TWG Alternative with the Hopi Tribe based on a non-disclosure agreement [the Department of the Interior] had signed. Ms. Belin further stated that she had intended to call the Hopi Chairman prior to the public announcement of the TWG Agreement, but that she got too busy to make the phone call.

“The United States’ and Intervenors’ suggestion that the Hopi Tribe was not treated differently from the other tribes who were invited to participate in the TWG must also be rejected. Although the United States points out that the Community Benefit Fund (‘CBF’) may be used for any projects within 100 miles of NGS or the Kayenta Mine Complex—which includes a portion of the Hopi Reservation—the Hopi Tribe has not been provided a seat on the oversight committee that selects projects for funding by the Community Benefit Fund. Without any voice in the funding distribution process, the Hopi Tribe cannot expect to receive funding from the CBF for any projects on the Hopi Reservation, particularly when the Navajo Nation will have a seat and is also within the radius eligible for funding from the CBF.

“The United States’ and Intervenors’ argument that EPA was not required to consider the economic impacts of NGS closure cannot be squared with the plain language of the Rule, and, therefore, must be rejected. Specifically, the United States proposes that “The sufficiency of a [best available retrofit technology] alternative is not measured by BART factors. It is measured, rather, by comparison with the progress toward improved visibility that would be achieved with BART.” However, the Regional Haze Rule mandates that a BART Alternative “must achieve greater reasonable progress than would be achieved through the installation and operation of BART.” “Reasonable progress” is a defined term of the CAA that means improvements in visibility that can be achieved taking “into consideration the costs of compliance, the time necessary for compliance, and the energy and nonair quality environmental impacts of compliance, and the remaining useful life of any existing source subject to such requirements.” The United States’ argument that it need not even consider these factors in selecting a BART Alternative must fail on its face.  

“Here, the United States’ adoption of the TWG Agreement in the Final Rule will have a crippling effect on the Hopi Tribe’s coal revenues. As SRP admits, NGS and the associated Kayenta Mine Complex “are the backbone of the Hopi economy.” There is no question that a reduction in the coal revenues from the Kayenta Mine Complex, will severely impact the Hopi government and people. The Hopi Tribe receives approximately $13 million annually in coal royalties and bonus payments, which it uses to provide basic services and other essential government functions such as health care, education, housing, law enforcement, and social services to the Hopi people. Without the coal revenues from NGS, both the Hopi Tribe’s government and people will suffer. In contrast, EPA explicitly found that the Proposed Rule, which required installation of standard pollution controls at NGS, was unlikely to force closure or curtailment of NGS operations.”

The tribe added: “There is no question that the Hopi Tribe was excluded from the TWG because certain TWG members felt that inclusion of the Hopi Tribe might make it more difficult to reach the TWG Agreement. This alone indicates that SRP believes that if the Hopi Tribe had been included in the TWG, the outcome would have been different. 

“The Hopi Tribe’s prayer for relief asks the Court to strike the Final Rule and remand for further proceedings in accordance with the United States’ consultation and trust obligations. Here, if the Final Rule is stricken, the Final Rule would no longer cause the Tribe’s injuries and the Tribe would have a meaningful opportunity to participate in the promulgation of a new rule and development of a BART Alternative.”

The tribe noted that after it filed its opening brief in this case, a group of plaintiffs – To’ Nizhoni Ani, Black Mesa Water Coalition and Diné Citizens Against Ruining Our Environment – filed a civil action for injunctive and declaratory relief against Jared Blumenfeld, the U.S. EPA Region IX Regional Administrator; Gina McCarthy, the U.S. EPA Administrator; Sally Jewel, U.S. DOI Secretary; the U.S. EPA; and the U.S. DOI, alleging that the United States violated the Federal Advisory Committee Act and the Administrative Procedure Act by its participation in the Technical Working Group. That case is currently pending in the U.S. District Court for the Northern District of California.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.