A minority owner of the Four Corners Power Plant received federal funding to study retrofitting the coal-fired generating station with carbon capture technology.
The Navajo Transitional Energy Company—an enterprise division of the Navajo Nation—announced this week that it has received $6.5 million from the U.S. Department of Energy’s Office of Clean Energy Demonstrations to conduct what is known as a Front-End Engineering and Design, or FEED, study.
FEED studies help determine what the project might cost and how long it will take to complete. They also help identify risks and establish the scope of the project.
NTEC currently owns about 13 percent of the Four Corners Power Plant, which operates seasonally to help meet peak demand for utilities like Arizona Public Service Company and the Public Service Company of New Mexico and is slated to close in 2031. The power plant is located on land leased from the Navajo Nation.
However, successful acquisition of the power plant will depend on negotiations about liability with the other owners—which is where a similar proposal at the neighboring San Juan Generating Station failed.
NTEC claims that installing the carbon capture technology on Four Corners will save more than 600 jobs and prevent the loss of $183 million annually to Navajo Nation in economic impacts. The company anticipates completing the FEED study in 2025.
Vern Lund, NTEC’s Chief Executive Officer, said in a press release that the Four Corners Power Plant and its associated Navajo Mine provide more than 35 percent of the Navajo Nation’s total revenue.
The funding for the FEED study ultimately comes from the Infrastructure Investment and Jobs Act, or Bipartisan Infrastructure Law, which provided billions of dollars in funding to advance technologies like carbon capture. The Inflation Reduction Act is also providing further investments into carbon capture technology and includes measures to bolster the 45Q tax credits for carbon capture.
The DOE funding will only cover about half of the total cost of the FEED study, which is anticipated to cost $13.1 million.
While the goal of the carbon capture technology is to remove 95 percent of the carbon from the flue gas, this has not been consistently achieved at commercial scale and there is currently only one utility-scale coal-fired power plant in the world that uses carbon capture technology. That one—Boundary Dam in Canada—only captures about 57 percent of the carbon emissions, according to a recent analysis by the Institute for Energy Economics and Financial Analysis. Another carbon capture project on a coal-fired power plant—Petra Nova in Texas—shut down the capture operations in 2020 when demand for oil plummeted thanks to the COVID-19 pandemic. That is because Petra Nova’s success depended upon the ability to sell carbon dioxide to oil producers for enhanced oil recovery.
Carbon capture also tends to be expensive compared to other types of electricity resources. A FEED study conducted for the San Juan Generating Station found that it would have cost about $1.4 billion to retrofit the plant with the technology.
Just running the carbon capture unit at the San Juan Generating Station would have used about 30 percent of the electricity produced.
And, unlike wind or solar, coal-fired plants require fuel and are labor-intensive. Those lead to higher operating costs than renewable resources.
Critics of carbon capture say that the money could better be invested in renewable resources and battery storage, though proponents say that carbon capture is needed to provide consistent power when the wind doesn’t blow and the sun doesn’t shine.
Other alternatives for providing that consistent power include improved battery storage and geothermal as well as controversial methods like pumped hydro, hydrogen and nuclear.
