“The Navajo Nation is committed to engaging in negotiations as this important process continues,” said Navajo Nation President Russell Begaye. “The nation is encouraged by the expressed interest of potential owners as the process moves forward.”
“We are pleased with the robust response to the plant’s ownership transition process to date,” said George Bilicic, Lazard vice chairman and global head of power, energy and infrastructure, who is leading the process. “In the next phase, we will continue an intense focus to develop a new ownership structure, working toward a final selection of investors and negotiating definitive agreements by the end of the first quarter of 2018.”
“Lazard believes the Navajo Generating Station is a critical resource in the region for power generation and resource diversity, and from a total regional economic impact perspective. Lazard took on this project because we believe there will be an optimal path forward that solves the needs of the many stakeholders involved, including the Navajo, Hopi and ratepayers in Arizona,” Bilicic said.
Development of the Navajo Generating Station was authorized by Congress and serves as a stable, affordable power source to move water across the state for the Central Arizona Project. The plant was sited on tribal lands, using Navajo and Hopi energy resources to create tribal jobs and revenues, helping the government fulfill its trust responsibility. It was commissioned to run 75 years through 2044.
The Navajo Generating Station recently has been running at about an 80% capacity factor and is competing cost-effectively to add reliability and resilience to the electric grid.
“The recent spike in Southwest power prices caused by high demand periods and higher natural gas costs demonstrates why the Navajo Generating Station and coal continue to be an essential component of a reliable, resilient and cost-effective energy portfolio for Arizona,” said Kemal Williamson, Peabody President – Americas. “We will continue our efforts to make the plant among the lowest cost, most competitive baseload power plants in the region.”
Fueled by Peabody’s Kayenta mine, the Navajo Generating Station began operating in 1974. The mine and the power plant support 825 jobs and provide approximately 85% of the Hopi Tribe’s annual general fund budget and 22% of the Navajo Nation’s annual general budget. Virtually all of the mine’s hourly workforce is Native American, and last year the mine contributed $430 million in direct and indirect economic benefits into regional economies.