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Groups pressure TEP to divest from San Juan coal plant

By Robert Walton | February 6, 2015

Dive Brief:

  • A coalition of Arizona community groups and businesses is pressuring Tucson Electric Power (TEP) to divest its interest in the San Juan Generating Station in New Mexico.

  • PNM's plan to shutter two of four coal units at the facility, and replace them with a mix of renewables, gas and nuclear, has come under fire and a coalition of groups supporting the plan appears to be dissolving.

  • Following weeks of hearings at the New Mexico Public Regulation Commission, PNM remains confident that its plan to shutter two units remains the most affordable option.

Dive Insight:

Arizona groups are pressuring TEP to divest its San Juan Generating interest, arguing that the plan to continue burning some coal at the facility is more expensive than adding more renewables to the mix. TEP owns half of one unit of the plant, which the groups say presents financial risks to local Tucson ratepayers if the utility continues its investment in the "expensive, outdated coal-fired power plant."

“Our community faces enormous threats if TEP leads us down a path of continued reliance on coal at the San Juan Generating Station,” said Dan Millis, Tucson organizer for Sierra Club’s Grand Canyon (Ariz.) Chapter.

“By continuing our reliance on an expensive out-of-state coal plant, TEP is locking our community into a future of more coal and expensive rate hikes that will threaten the pocketbooks of families in our region," Millis said. "It’s time for TEP to protect ratepayers here in Arizona by getting out of a dirty, expensive out-of-state coal plant and investing in local clean energy such as solar.”

Hearings on the plan concluded last month, and PNM says it remains committed to the proposal.

According to the Albuquerque Journal, PNM is still confident in its plan. Vice President for Regulatory Affairs Gerard Ortiz told the newspaper that "if you look at the facts and step away from the rhetoric, retiring two of San Juan’s four units is still the best option," and will cost customers the least.

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