REVIEW-JOURNAL

Experts and attorneys argued the fate of the Mohave Generating Station, a coal-fired plant in Laughlin, in hearings that began Monday at the California Public Utilities Commission in San Francisco.

The Hopi Tribe, the Navajo Nation and Peabody Western Coal Co., which operates a strip coal mine on land jointly controlled by the two Indian groups, are urging the state regulatory commission to provide a "conditional" certificate of public convenience and necessity for the continued operation of the Mohave plant.

About 300 workers are employed at the mine, and 350 work at the Mohave plant in Laughlin. The Hopi Indians also receive 30 percent of their operating revenue from coal royalties. Additional Indian tribal jobs would be lost if the power plant is shut down, said James Ham, an attorney for the Hopi Tribe.

Nevada Power Co. owns a 14 percent interest in the Mohave plant, but Southern California Edison operates it. Other partial owners include the Los Angeles Department of Water and Power and the Salt River Project, a municipal power agency serving the Phoenix area.

Mohave has been controversial because it lacks some of the sophisticated pollution-reduction equipment found at other power plants and because it allegedly has contributed to haze over the Grand Canyon.

Yet coal is a relatively low-cost fuel for power generation and helps reduce Nevada Power's reliance on natural gas as a fuel. The savings to consumers from operating Mohave another 30 years is $1.6 billion in present-day dollars, Ham said.

A local utility official agreed.

"Mohave represents an attractive source of power to Nevada Power, which is coal-fired and which does help us diversify (fuel sources) and provides a stabilizer on the price of power we charge to the public," Nevada Power Vice President Roberto Denis said.

The utilities that own Mohave, however, face a number of problems that must be overcome if the plant is to continue operating.

Coal from the Indian reservations is mixed with water and transported by slurry line to the Mohave plant in Laughlin.

However, the Indians don't want their underground drinking water reserves depleted for the slurry line. They propose Mohave pull water from another underground source and pipe it to the coal mine for use in the slurry line.

"An alternative source for the slurry water required for delivering Mohave's coal supply still remains under study and uncertain," witnesses for Edison said in written testimony.

"The contracts for Mohave's post-2005 supply of coal and slurry water remain under negotiations ...," the testimony said. "Challenges to the validity of the coal leases continue, and the capital cost estimated for pollution controls and other upgrades remain imprecise."

Ham rejected those arguments, saying Edison was "hiding behind details." The plant will provide huge savings, he said, given any reasonable price for water and coal.

"The commission's action would amount to a statement that the final terms and conditions of the coal and slurry water contracts, including price, are immaterial to the commission and should be immaterial to (Edison)," Edison said in testimony.

In addition, the Mohave plant owners agreed to a federal court decree that requires the plant to shut down by the end of 2005 if pollution-control equipment hasn't been installed. The Sierra Club and Grand Canyon Trust, another environmental group, sued over pollution from the Mohave plant.

Edison believes the pollution reduction equipment and other improvements will cost $1.08 billion.

Ham thinks the plaintiffs, who obtained the court order, will agree to delay installation of the pollution controls, particularly if California regulators grant a conditional certificate for the plant.

"We believe that the environmental plaintiffs will not inflict massive economic harm on the tribes" by refusing to grant a short delay, he said. "There are a lot of technical and legal issues that need to be negotiated, and the parties are negotiating."