By Ryan Randazzo | The Arizona Republic
Salt River Project is negotiating to purchase a share of the embattled Navajo Generating Station in northern Arizona from a California utility that is cutting ties with the coal-fired power plant.
The deal with the Los Angeles Department of Water and Power could be worth about $189 million, based on a similar, recent transaction. But because the California utility is seeking to quickly sell its stake in the plant, whose ownership is shared by five utilities and the U.S. Bureau of Reclamation, the price could be lower.
The plant near Page faces a host of environmental concerns and pending upgrades mandated by the Environmental Protection Agency that could make it more expensive to operate while limiting potential buyers and its value.
There are signs the negotiations could be coming to a close. Los Angeles Mayor Antonio Villaraigosa, speaking publicly last week, said that within “a couple of weeks” he would be signing papers that would get the city out of the plant by 2015.
An LADWP official previously said the utility was in “exclusive” negotiations to sell its stake in the power plant, and the Navajo Nation, whose reservation is where the plant is based, disclosed last month that LADWP was negotiating with SRP and that the deal needed approval from their respective authorities.
SRP officials said that the power plant is important to the state and that it is best to keep it operating.
