The “Arizona” Generating Station Needs to Benefit Navajos

Dwight Witherspoon
May 20, 2013


Although the Navajo Generating Station carries the name of the Navajo people, the “Navajo” Generating Station previously negotiated in 1968 and 1969 had significant flaws for the Navajo Nation. First, five power companies along with the United States Bureau of Reclamation planned a way to generate cheap electricity and deliver water throughout the State of Arizona by using the Navajo Nation’s resources. Second, the Navajo Nation was exploited for use of their land, water and coal with little benefit. Therefore, it is critical for the Navajo Nation to re-negotiate Navajo Generating Station’s (NGS) use of Navajo land, water, and coal; including, taxes and ownership so the Navajo Nation experiences maximum benefits.

The Generating Station is operated by Salt River Project (SRP) who has (21.7 percent) ownership and shall own (24.3 percent) of the Generating Station for the use and benefit of the United States of America. This designation of ownership from the U.S. Bureau of Reclamation (BOR) to SRP was intended for two purposes: 1) attempt to alleviate a conflict of interest as a trustee for the Navajo Nation (yet allowed if not influenced the Navajo Nation to waive claims to the Upper Colorado River Basin for the life of the Generating Station or 50 years to provide cheap energy), and 2) establish a non-profit entity called the Central Arizona Project (CAP) to annually deliver 1.5 million acre feet of cheap water throughout Arizona. The ownership energy designated for SRP from BOR is used to lift the water for transportation from the Lower Colorado River and to help repay BOR for the construction of the Central Arizona Project. Central Arizona Project (CAP) delivers 50 percent of the water for Phoenix and 80 percent of water for Tucson; as-well-as, water to the central Arizona Tribes and to recharge the overdrawn aquifers in Phoenix Valley and Tucson. Generating Station owners also includes: Arizona Public Service Company at 14 percent; Department of Water and Power of the City of Los Angeles at 21.2 percent Nevada Power Company at 11.3 percent; and Tucson Gas & Electric Company at 7.5 percent.

The planned exploitation of Navajo land, water, and coal to generate cheap electricity and deliver water throughout Arizona was negotiated in 1968 and 1969. 7,466 acres of Navajo land is used for the Generating Station including: right of ways for train rail to deliver the Navajo coal to NGS, right of ways for power lines, coal ash placement, and other smaller land uses. In 2010, the Navajo Nation received $608,000 for their land lease(s) to NGS. In the same year, the Navajo Nation received no taxes from NGS, but taxes were paid to the State of Arizona. The Navajo Nation did not receive any money for taxes paid to the Nation until 2011. The Generating Station is able to use 34,100 acre feet of the 50,000 apportioned to the State of Arizona from the Upper Colorado River Basin for a small delivery fee to the Bureau of Reclamation (which use to be 7.00 dollars per acre feet). The Navajo Nation had to waive their claim to the 50,000 acre feet and any claim above the 50,000 acre feet apportioned to the State of Arizona for the life of the Generation Station or 50 years; which-ever comes first, and 50 years will be in September 2019. The Navajo Nation waiver by Resolution CD-108-68 allows for 34,100 acre feet of the 50,000 to be used for NGS. The Navajo Nation was influenced by the jobs, possible coal revenues from Peabody and NGS jobs with lease revenue to agree to this waiver. This Navajo Nation wavier of claim to the 34,100 acre fee of water at $1,000 per acre feet would be $34,100,000 per year. The Peabody Energy or Peabody Western Coal Company (PWCC) pays the Navajo Nation 12.5 cents for the exclusively Navajo coal and 6.25 cents on the Navajo/Hopi joint coal. The PWCC pays $471 dollars per acre feet for lease of the Navajo Aquifer Water (which is some of the best water in the country) and is used for dust suppression, cleaning trucks/large mining equipment, and human use (including water hauling for Navajos’). PWCC used to pay a little over $1,000 per acre feet for use of Navajo Aquifer Water from the ten year negotiated period of 1997 to 2007. The PWCC uses around 1,200 acres feet per year and used to use much more to slurry coal to the Mohave Generation Station in Nevada, which was shut down in 2005. Therefore, the Navajo Nation will be seeking to maximize its benefits from the Generating Station through lease(s), taxes, ownership, and water waiver in the re-negotiations that has exploited the Navajo Nation for almost fifty years.

Credit goes to the grassroots people and organizations for educating me on issues regarding the “Arizona” Generating Station and for suggesting that the Navajo Nation should push for ownership in NGS. When meeting with NGS representatives, the small benefits to the Navajo Nation was clearly drawn out and it was also clearly pointed out that there needs to be an ownership provision or the Nation will be advocating to charge the highest possible for the lease, taxes, and water waiver for a poor 1969 agreement. Only through a Navajo Nation ownership provision will the re-negotiation be a win-win for all; otherwise, the re-negotiation will be a win-lose for one and a loss for the other (meaning the cheap electricity and cheap water rates will dramatically increase throughout Arizona). Only through increases in land lease, taxes, ownership, and ability to make claim to the water in 2019 can the Generating Station be called the “Navajo” Generating Station.

Dwight Witherspoon is a Navajo Nation Council delegate, representing five chapters: Black Mesa, Hard Rock, Pinon, Forest Lake and Whippoorwill.



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