Desert Rock backers take permit issue to court

WINDOW ROCK, March 20, 2008

The Diné Power Authority and developers of the Desert Rock Energy Project lost no time in making good on their earlier threat to sue the U.S. Environmental Protection Agency.

Late Tuesday they filed a lawsuit aimed at forcing the EPA to issue an air quality permit allowing them to proceed with construction of the 1,500-megawatt Desert Rock Power Plant.

The filing came one day after the deadline expired on their intent-to-sue notice, filed 60 days ago.

The suit was filed in U.S. District Court in Houston by Sithe Global Power, the Texas-based owner of Desert Rock Energy Co., and the DPA, which is helping to facilitate the project.

On Jan. 17, Bracewell & Giuliani, a Washington, D.C., law firm representing Sithe, notified the EPA that the company planned to sue on grounds that the federal agency had violated the U.S. Clean Air Act by not issuing its decision on the air quality permit application within a year.

The proposed $3 billion coal-fired power plant would be located about 20 miles south of Shiprock and would be the third major power plant in the area, giving rise to a large number of public comments challenging the permit application.

On March 12, Desert Rock vice president Nathan K. Plagens said the lack of an air quality permit has not only blocked construction of the plant, but has also stymied the sale of its power. The plant would generate enough electricity to serve more than a million homes.

Plagens said Sithe has issued several requests for proposals to purchase the electricity. The company is looking to utilities that serve the Southwest's big cities, such as Arizona Public Service, Nevada Power and the Salt River Project, as the likeliest buyers.

No local hookups

Plagens confirmed that none of power generated by Desert Rock would go to Navajo families living near the plant.

Direct transmission is not physically possible because of the enormous difference in voltage between the plant output and residential electric systems.

A separate transmission system, including substations to reduce the voltage, would have to be built to serve local homes, a prohibitively expensive undertaking, he explained.

Plagens noted that the Navajo Tribal Utility Authority is responsible for providing electric service to reservation homes, and said Sithe is open to meeting with NTUA about the possibility of contracting for some of the power generated by Desert Rock.

On Tuesday morning, Margot Perez-Sullivan, EPA spokesperson, said her agency had not been served with a lawsuit and that if one was filed, the EPA would not comment on issues in litigation.

Perez-Sullivan added that the EPA is still responding "in a meaningful manner" to more than a thousand public comments that were received during public hearings on the environmental impact of the proposed plant in 2007.

She explained that all the comments would available to the public when the EPA releases its final decision on the air permit for Desert Rock.

Perez-Sullivan declined to give an estimated date for the agency's decision.

She added that federal regulations give the EPA a year to issue an air permit and also recognizes that the "complexity" of a project may demand additional time.

"Desert Rock is very complex and has taken more time," Perez-Sullivan noted.

President Joe Shirley Jr. on Wednesday called the delay "atrocious" and said, "We've been working on trying to get at the air permit since the early months of 2004 ... Here it is 2008, we've yet to hear from the EPA.

"It's bureaucracy. It's red tape," Shirley said. "Hopefully, now that we have filed suit the U.S. EPA will be expeditious in promulgating a decision."

Richardson a critic

Groups opposing Desert Rock claim that 95 percent of the public comments criticized the project, and the critics include New Mexico Gov. Bill Richardson.

Richardson stated his position on Desert Rock on July 27: "As planned this new facility will adversely impact air quality, exacerbate existing environment problems, and negatively impact scarce surface and ground water resources."

The comments were in response to the draft environmental impact statement on Desert Rock, which concluded that it would have some - but not intolerable - negative impacts.

Shirley, in his statement on the lawsuit, emphasized the project's potential economic benefits, saying it "denotes jobs for our people, good-paying jobs, (and) $53 million for our Nation's coffers to put into direct services out there in Navajoland. This is a long time coming."

Dailan Long, a Burnham Chapter resident who lives near the planned 580-acre plant site, said Wednesday that the issues surrounding Desert Rock "cannot be ignored or overlooked for a quick economic fix."

"The EPA is in a deliberative process on a very critical issue facing us in Burnham," said Long, a community organizer for Diné Citizens Against Ruining the Environment. "From information contained in the draft EIS for Desert Rock, there remain many unanswered questions that Sithe has failed to speak to."

Referring to existing emission sources such as the Four Corners and San Juan power plants, he said, "Desert Rock is not independent of a large industrial complex in northwest New Mexico and to make a reasonable decision on an air quality permit in the context of existing conditions requires further scrutiny and adequate information."

In their lawsuit, Sithe and the DPA cited the sections of the Clean Air Act that state once a permit application is deemed complete - it includes everything required by the act - the agency has one year to issue its decision.

The complaint notes that on May 21, 2004, the EPA issued a letter saying that the Desert Rock application was complete.

"We are pleased to support President Shirley, DPA and the Navajo Nation in their effort to break this permit free of the log jam preventing this important economic development opportunity for the nation," said Frank Maisano, Sithe spokesman, on Tuesday.

"It has been nearly four years since the Navajo Nation and its partners were told it had an approved permit application," he said. "Statute requires a decision in 12 months."

The EPA has 30 days to file its response to the suit.