Desert Rock will incorporate a hybrid dry cooling system to minimize water consumption by more than 80% compared to a typical coal fired power plant. A majority of the water will go to enable an extensive array of pollution controls that without the water would not be possible. The project will be "zero-discharge" meaning there is no water discharged from the plant. As part of the agreement with the Navajo Nation, groundwater is taken using very deep wells (5,200 to 6,000 feet deep) from sources that are non-potable and not fit for human consumption. Desert Rock has agreed to provide a well that will supply 450 acre feet per year to surrounding communities to help meet their water needs. Intensive studies have been prepared by experts in the proper fields to understand the local and regional groundwater system and to demonstrate Desert Rock will not have an adverse impact on these systems.
Desert Rock continues to study the technology and cost of what is called Carbon Capture and Sequestration (CCS) in power plant applications. We have had numerous conversations with the Department of Energy, various national laboratories, equipment suppliers, and regional concentration groups to understand the ability to implement the technology in a large scale application like the Desert Rock project. At this time we are unable to identify a commercially feasible means to enable this technology. Major equipment suppliers are unwilling to offer performance guarantees for equipment so large. There is no proven means to sequester the CO2 at this time. In addition, an appropriate mechanism to recover the cost of implementation, including the cost of development, installation and operation, has not yet been implemented or discovered.
Click here to see panoramic picture of the Desert Rock Energy project site. There is no one living near the site.
The site is leased from the Navajo Nation (NN) with consent from the Bureau of Indian Affairs (BIA). The value of grazing rights is determined by the Navajo Nation Land Department, typically based on the number of “sheep units” held by the permitees. Each land owner negotiates with and is given payment directly from the NN Land Department when they release their grazing rights or the money is held in escrow by the NN Land Department, the project compensates the NN Land Department. The process to release grazing rights is reviewed by the Chapter grazing rights official. All individuals having grazing rights were offered and paid the determined fair value compensation.
The plant will be constructed and operated as a "zero-discharge" facility. This means no liquids other than storm water run-off will come from the plant that might contaminate groundwater.
There are no families living on or near the site where the power plant is to be built. One resident is living within 1.1 miles of the proposed plant on the BHP Navajo Coal Lease. This resident had agreed with the Navajo Nation Land Department well before the development of Desert Rock to move and allow for coal to be mined.
The new units will generate 1,500MW of electricity.
The first unit is scheduled to be completed and operating by 2012.
The Desert Rock Energy Project will utilize the most advanced air emissions controls in the world. Click here to find out more.
The project will have an average of 1,000 construction jobs over a four-year period. It will also create 400 permanent jobs to operate the power plant and coal mine.
Economic development is one of the key goals of the Navajo Government since the economic condition of Navajo tribal members is well below US averages. Based on the 2000 census 38.5 percent of all families on the Navajo Nation have a household income under the poverty level. Unemployment rates exceed 50 percent and many college educated students are unable to return to their homes because of lack of jobs. Adding 400 jobs to the New Mexico Four Corners area will create up to 400 households with an income of more than double the median household income.
This region of the United States is growing at a very fast pace. The Western Electricity Coordinating Council identified the Arizona/New Mexico/Southern Nevada sub-region of the western United States (of which the Four Corners area is a part) as an area in need of additional power generation to sustain growth. Click here to find out more.
The project will be located approximately 30 miles southwest of Farmington in San Juan County, New Mexico and is entirely on the Nenahnezad and Burnham Chapters of the Navajo Nation.
The Desert Rock Energy Project will have a significant, positive effect on the economy and well-being of the Navajo Nation. Tax revenue will be $50 million annually. Click here to find out more.
Natural gas prices have increased substantially over the last three years and prices have been extremely volatile. Navajo coal sold under a long-term contract is expected to cost less than 25 percent of the cost of natural gas per MMBtu and because it can be contracted for as long as 25 or 30 years it should have much less price volatility. Building a natural gas fired plant would not allow for the use of Navajo Coal.
Integrated Gasification Combined Cycle (IGCC) is a developing coal technology that offers the potential for improved environmental performance and high efficiency. The heat rate for an IGCC plant is estimated as 9,775 Btu per kilowatt hour (Btu/kWh) while the estimated heat rate for Desert Rock Energy Project is 8,792 Btu/kWh (net, higher heating value basis). This increase in heat rate will result in an IGCC plant at the Desert Rock site having higher fuel consumption and greater generation of green house gases such as CO2. Read more here about IGCC.
Major utility companies in the region are talking actively with the project about committing to long-term power purchase agreements that will sustain the development and operation of the project.
Third quarter 2009