By VERNON ROBISON
Moapa Valley Progress
The Moapa solar project, a $438 million photovoltaic solar generating plant proposed to be built on Moapa Paiute Indian Reservation land, was rejected on Monday, October 27, when state regulators removed it from a comprehensive plan presented by regional utility Nevada Power. The plan involved Nevada Power retiring its coal-fired electricity generating plants within the next five years and replacing them with other sources, including renewable resources.
The Moapa Solar project would offer a nameplate generating capacity of 200 megawatts, but a firm capacity estimated at only 76 megawatts. It was being proposed as one of the components of the plan to replace a total of 550 megawatts of coal-generated power being retired from the Nevada Power portfolio.
The Nevada Power proposal was made before the state Public Utilities Commission (PUC) in May of this year. It was proposed in response to Senate Bill 123, passed by the 2013 Nevada State Legislature. which directed the utility to move away from coal-fired sources and toward renewable forms of energy.
The plan proposes to close the company’s Reid Gardner Station in Moapa. Units 1, 2 and 3 at Reid Gardner would be decomissioned by the end of this year. Unit 4 would be closed by the end of 2017. The units would then be dismantled and the site reclaimed.
Finally, the company would divest itself of its interest in Arizona’s Navajo Station, the last coal-burning resource supplying southern Nevada, by the end of 2019.
Altogether the plan would retire 800 megawatts of generating capacity. It then proposes to replace those resources with 550 megawatts of firm generating capacity which is not “technology-specific.” This means that renewable resources are not necessary in replacing that block of resources. The remaining 300 megawatts of capacity would be acquired over time through developing new renewable sources, according to the plan.
The plan detailed a proposal for Nevada Power to acquire three existing natural gas generating units in Las Vegas which would total around 496 megawatts of generating capacity. These three units would be acquired at a total cost of $130 million.
Then, with 54 megawatts of capacity still needed to fill the 550 megawatt block, the Moapa solar plant was proposed to fill the remaining gap with its 76 megawatts of firm capacity.
But the PUC decided to strike the Moapa project from the plan, finding that the costly facility would not be in the public interest. Rather than allowing the construction of a utility-owned solar plant, the PUC asked Nevada Power to seek alternatives to replacing the 54 megawatts of unfulfilled capacity by issuing a competitive “request for proposal.” This would presumably secure a lower cost for ratepayers.
The final PUC vote had Commission Chairwoman Alaina Burtenshaw and Commissioner David Noble in favor of the order which left out the Moapa project. Commissioner Rebecca Wagner supported the order with the exception of striking the Moapa piece from the plan.
After the vote, Nevada Power issued a statement. “Today’s order changes our filing considerably. Once the final order is issued, we will use the review period to understand how these changes will impact our plan to reduce emissions and develop resources for the benefit of our customers.”
The plan, with the Moapa solar component, had received support from the Nevada Conservation League and the Nevadans for Clean Affordable Reliable Energy (NCARE), because of its aim to reduce CO2: replacing coal sources with cleaner natural gas and “zero-emissions renewable sources.” The organizations lauded the plan for putting the utility in a good position to comply with EPA Proposed Carbon Rules, which have not yet been put into effect.
The Moapa project was also supported by representatives of the AFL-CIO who said that it would bring jobs to the southern Nevada region.
Moapa Paiute officials also spoke in favor of the Moapa solar project being included in the plan. The proposed plant would be the second industrial-grade solar plant to be built on Moapa Indian Reservation land. The first is a 250 megawatt plant, currently being constructed by First Solar, which is under contract to supply energy to Los Angeles Department of Water and Power.
In a statement filed with the PUC, representatives of the Bureau of Consumer Protection (BCP) sought to have the Moapa solar component removed from the plan because of its high cost to ratepayers.
“Spending nearly half a billion dollars on a project intended to fulfill only 54 megawatts of non-technology-specific capacity is excessive,” the statement reads.
The goal could be much more economically reached by constructing a smaller combustion turbine, the statement said.
BCP projected the cost of power from the Moapa solar facility would be around $111 per megawatt hour. They compared that to a combined cycle combustion turbine where cost of power would be as low as $70 per megawatt hour under favorable market conditions and as high as $103 per megawatt hours when cost of fuel was at a peak.
“Moapa does not offer a hedge to natural gas volatility,” the BCP statement concludes. “It undermines the resource diversity that Nevada Power credits the preferred plan with achieving.”
In a written recommendation, PUCN staff expressed similar concerns about costs. The staff observed some discrepancies in calculations made by Nevada Power in its cost projections and an overestimation of the projected economic benefits that might result for the region.
The staff write-up also expressed concern about the cost of land that the Moapa solar project would lease from the tribe. This lease was considerably more expensive than the lease cost of a similar project built on BLM land, the staff statement claimed.
To counteract that expense, staff recommended that two conditions be placed on the lease agreement with the tribe. First, the tribe should agree to not oppose any future action taken by Nevada Power to construct a new natural gas plant at the Reid Gardner site. Secondly, the tribe would agree to support the use of the Moapa project as a renewable energy facility for the state’s compliance with EPA’s 111 regulations.
In a written response to this, Nevada Power formally opposed the staff recommendation stating that it was not yet a party in a lease agreement with the tribe and, thus, not in a position to seek concessions from the tribe regarding future development at the Reid Gardner site.
In her 95 page draft order, Commissioner Wagner argued in favor of keeping the Moapa solar project in the plan. She said that the solar component, along with natural gas generation, provided a degree of fuel diversity in the plan.
She pointed out that the Moapa solar project is an essential part of the delicately balanced package being presented by Nevada Power. Removing one component of that package would upset the balance, she said.
She also noted that, if the utility did not support the changes made by the PUC, the company could withdraw its filing altogether. This could delay the closure of Reid Gardner, she said.
“It is not an option to jeopardize the closure of these coal plants,” she said.
Commissioner Noble, in his draft order, approved of the natural gas acquisitions but eliminated the Moapa solar project. He argued that the project was unnecessary.
“The capacity is not actually needed by Nevada Power until 2020 when (the company) plans to build a 600 megawatt combined cycle plant,” Noble said.
“It’s economic benefit to the state is inconclusive at best; its costs are unnecessarily high for Nevada Power’s customers; its impact on the opportunities for creation of new jobs in this State is inconclusive at best; and its value to Nevada Power’s customers is negligible,” Noble said of the Moapa solar project.
Noble concluded that, if there is no need for the Moapa project, then “the economic benefit to the State realized by its construction and operation is largely negated by the economic costs to fund (it)…. It is simply a transfer of wealth from ratepayers to all of the entities that benefit from the construction and operation of the project. Most of the beneficiaries are not in this State.”
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