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169RESOLUTTON NO. 2013-1485

A RESOLUTION I'RGING TI{E E}IVIRONMENTAL I!'IPROVEMEI\IT BOARD TO NOTADOPT AIiIY "REGIONAI, I{AZE RI,LE, STATE III{PI,EITIENTATION PI.AN (SIP) THATIIiMOLVES C],OSING DOWN I]NITS AT TIIE SAN 'ruAN GENER]ATING STATION!{HEREAS, the EnvironmenE.al Protection Agency (EPA) haE adoptsedregulationa regarding air vieibility isaues in this region which areI ;ffi,";;:,;#:,"":';;1.-:,,*i,,:,,1*=,,,*,=::..1"::;is referred to in the regnrlations aa 'Best Available Retrofit Technology"or BART,. andWI{EREAS, Ehe Regional Haze Rule regulations required ltre Etaleswithin the region covered by Ehe regulations to submiE. to the EPA a StateImplement,ation Plan or SIP proposing how tbe installation of BARTtechnoLog'y on plants $rithin the st.ate would bring them in compliance withthe goals of the Haze Rule; andWHEREAS, Ehe State of, Nev, Mexico, under a previous governor'Eadministration, failed to submit an sIP to the EPA within the tine periodrequired by the regulations and the present administration then adoptedand submitted New Mexico's original SfP for tshe San.Tuan Generatj-ng

station which required all four unils at the San .fuan Generating Station(SJGS) to add Selective Non-catalytic Reduction or "sNcR' tsechnolog-y toreduce part.iculates, but that plan waa not approved by the EPA and theEPA then adopted a Federal ImpLementaEion PIan or *FIP' which'requiredinstallation of Selective Cat.alytic Reduction or "SCR" tecbrolog-y on al]four units; andWHEREAS. Ehe coEE of insEalling SCR Uechnology waE so expensive(eBtimated by PNU t,o be as much ae $750 million to $1 billion) that Ehe

- operator of the pl-ant,, Public serwice Company of New Mexico (pNI|!),I appealed EPA'8 action to the federal courts and asked the Etate of, NewI Mexico to intervene and propoae an alternative SIP vrith a higherr probability of beihg approved by Ehe EpA; and$II{EREAS, the EPA,S refusal to adopt the installation of SNCRtsechnology forced tshe state and PNIrr, in order to meet the haze reductiondemandg of tshe EPA, to propoEe alternatives that included cloeing downuniEe of the pl,ant in order to meets thoee demand6, andWHEREAS, after many difficult negotiation seseions, PNM, the Statcof Nelv Mexico and the EPA reached an AgreemenE in erinciple (AIp)outlining a way of g'oing forward that would avoid further litigaE.ion andlead to adoption of a new SIP, however, the AIP contemplateE a new*AlEernative SIP, which would require Ehe closing of two of the fourunits at SJGS; andWHEREAS. cLosing down the two uniEa as propoEed by the Alt,ernateSIP would eliminate 837 megawaEts (Mw) of generating capacity aE, Eheplant with Ehe only new generation coming from a proposed natsural gaspowered peaking plant capable of generating 120-200 Mw, buE orrlyoperating a! a 10t load factor, producing a reduction of net capacity ofover 800 MW, andWI{EREAS, the closing of two units at SJGS rrould also mean a massivereduction of the number good high-paying jobs at PNM and aE san Juan coal

r company, the mine operaEor at the San ,fuan CoaI Mine which supplies coalI to SJGS, and the loss of these jobs would have a E,remendoua negativeI effect on the locaI economy; andI WI{EREIAS, the stat.e, which is already struggling to meet it.sexpensea due to the recent recession, would also gee a reduction inseverance taxes due to thc reduced mining activity at the San .fuan Mine,andWIIEREAS, the Citsy of Farmington generally would be supporEivc ofcollaborative soluEions designed to implements federal reg"ulat.ion in a waythat the stakeholders can support, however it also reeognizes that thenation, state and locat region ie struggling in thc wake of the recent

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170general receEe:i.otr and that San iluan Countsy is also feeling Ehe negativeeconomic effecEs of a downturn in natural gas production in the area; and

!{HEREAS, the City Couneil has weighed these factors and haEconcluded that it cannot support the AIP and the ALternative SIP whlch,if carried out, would lead to losE of jobs and a devast,aEing effect onour struggling econony, andWHEREAS, since the terms of the Agreement in Principle (AIP) are

designed in parE to miEigate the negative effects of closing dowr uniEEat the San ,ruan Generating Station, the City of Farmington anticipateEaD.d expectB that if the Environmental InprovemenE Board does adopt theAlternative SIP as recommended by Ehe AIP, the parEies to the AIP shouldbe obligaEed Eo carry out all Ehe terms and conditions of the AIP,including PNM'B commitment to construct a natsural gas fired peaking plantat or near Ehe current s,fcs Eite.NOW, THEREFORE, BE IT RESOLVED BY TI{E GOVERNING BODY OF TI{q CITY OFFARI.{]NGTON, thaE the City opposes the adopEion of, any alternativC-.StateImplementat,ion Plan which requires the closing of units at s,JGs. \BE IT FITRTHER RESOLVED that the CiEy urges the New lttexi.coEnvironmental Improvemer:.t Board to coneider the negaEive effecEs on Ehelocal economy that would be caueed by the shutdown of uniE,s at S,IGS inits decision making and to consider ot.her solutions whereby all fourunits could continue in operation and the related high-paying jobs aE Eheplant could be preserved.BE IT FURrHER RESOLVED Ehat Ehe expectation of the Ctty is that ifthe Altsernative sIP is approved, Ehe parties !o Ehe Agreement inPrinciple (AIP) xri1l adhere to alL of the terms of the AIP, includingP.NM's commitsnent to construct a natural gas fired peaking plant of t,heeize and t]|pe contemplaEed in the AfP,BE IT FURTIIER RESoLVED that city sEaff is directed to distribute acopy of thiE resolution to the New Mexico 8[vironment Department andmembers of the Environmental Improvement Board; and is directed to su-bmita copy of tshls regolution intso the record of the EIB hearing on theAlternative SIP which is scheduled t,o be held in Farmington onSeptember 5 and 5, 2013.PASSED, APPROVED, SfGNED BND ADOPTED lhis 3d day of September,20t3.

ftk rSEALATTEST:

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I

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OId Business - 1September 3, 2013

ffi:ConsiderationofResolution13-14.19,UrgingtheEnvironmentallmprovement Board to Consider the Negative Effects on the LocalEconomy for the Adoption of the Alternative State lmplementationPlan (SlP) as Agreed to by the State of New Mexico, theEnvironmental Protection Agency (EPA) and the Public SeMceCompany of New Mexico (PNM) on February 15, zOfiKim Carpenter, CEO

ffi: KimCarpenter,CEoApproval of Resolution 13-14-19

This itern was tabled at the August 2A,2413.Attached is a substitute Resolution 13-14-19 which urges the New MexicoEnvironmental lmprovement Board to consider the negative effects on the localeconomy that would be caused by the shutdown of units at the San Juan GeneratingStation (SJGS) in its decision making and to require PNM to build a 150-200 MV naturalgas plant at SJGS, to not lay off any of its SJGS employees affected by the two-unitshutdown, to fulfill its commitment to the PNM{tlavajo Nation Workforce Traininglnitiative in the amount of $1 Million over five years in partnership with San Juan collegeand the Navajo Technical University in Crownpoint and to contribute $150,000 to Fourcorners Economic Development.

ffi N/A ffi'YESI1 Not ]Linda Thompson

Effiffiffififfi, Reviewed hlt: Comments:IIII

ItIt

Not ApplicableLEGALFINANCEPURCHASING*rfrl [

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Ebott EctstetnChalreanJaok FortuerChaiimsnProTenKelttr JohnsMe$ber

Margatct McDanlolMemberGlo.Iean TodacheeneMsnber

Mr. Klm J. CarpenterCormtr&ecutlvc Otrce

1O0 South Oliver DriveAztec, New Mexico 8741O-2432Phone: (505) 334-9481 Fax (5o5) 334-3168www.sjcount5r.net

sAN JUAIY COt NTY, NEW ME)ilCORESOLUTION NO. 13.1+19

URGING Tm, ENMONMENTAL IMPROYEMENT BOARD TO CONSIDER THENEGATIVE EJFECTS ON TIIE LOCAL ECONOn/T F'OR THE AI}OPTION OX'THEALTERNATIVE STATE IMPLEMENTATION PLAI\I (SIP) AS AGREED TO BY THESTATE oF I\TEW MEXICO, TI{E ENVIROMvIENTAL PROTECTION AGENCY @PA)'AND THEPIIBLIC SERVICE COMPANY OX'i\tEW MEXICO (PNM) ON FEBRUARY 15,2013

WIIEREAS, the EPA has adoptedregulations regarding air visibility issues inthisregior which are sometimes feferredto as the *RegionalHaze Rule"; andWHEREAS,these regulationsrequire coal-firedpowerplants inthe regionto install

equipment to rduce the release of particulates which is referted to in the regulations as o'BestAvailable Retrofit Technology" ot BART; and.

WHEREAS, the Regional Haze Rule regulations requircd each state's envirormentalagency to propose to the EPA a SIP uihich would detail the specific requirements forpowerplants within the state that would meet the BART requirements; and

WIIEREAS, the originat SIP for the San Juan Generating Stationproposed by NewMexico required all four units at the San Juan Genemting Station (SJGS) to add Selective Non-Catalytic Reduotion or "SNCR'technology to reduce particulates, butthat plan was notapproved by the EPA and the EPA then adopted a Federal Implementation Plan or "FIP" whichriquired instailation of Selective Cataffic Reduction ot "SCR" technology on all four units; audIYIIEREAS, the cost of installing SCR teehnology is so expensive (estimated by PNM to

be as much as $750 million to $1 billion) that the operator of the plant, PNM, appealed EPA'saction to ttre federal courts; and

WHEREAS, PNI\4 the State of New Mexico, and the EPA reached an Agreenrent inPrinciple (AIP) outlining away of going forward that would avoid further litigation and leadtoadoption of anew SIP; however, theAIP contemplates ane$r "Altemative SIP"'ufuichwouldrequirethe closing oftwo of the four units at SJGS; and

COUNTY

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WEEREAS, the closing of two units at SJGS would also rnean a massive reduction inthe nrunber of good highjaying jobs at PNM and at San Juan Coal Company, the mine operatorat the San Juan Coal Mine which supplies coal to SJGS, and the loss of these jobs would have ah'emendous negative effect on the looal economy; and

WIIEREAS, the San Juan County Commission generally would be supportive ofcollaborative solutions designed to implement federal regulations in a way that the stakeholderscan support; however, it also recognizes that the nation, statq and local rogion is struggling inthe wake of the recent general recession and that San Juan County is also feeling the negativeeconomic effects of a downturn in natural gas production in the area; and

WHEREAS, the County Commissionhas weighed these factors and has concludedthatthe closure of units at SJGS pursuant to the AIP and the Altemative SIP would lead to loss ofjobs and a devastating effeot on our stuggling economy unless steps are takento address theadverse economic impacts f,'om the closure of units.

NOW, THEREX'ORE, BE IT RESOLVED that the Board of County Commissioners ofSan Juan County, New Mexico, urges the New Mexico Environmental Inoprovement Boardtoconsider the negative effeots on the local economy that would be caused by the shutdown ofunits at SJGS in its decision making and to require PNM to build a 150-200 MW natural gasplant at SJGS, to not lay offany of its SJGS employees affected by the two-unit shutdown, tofuIfill its commitment to the PNM-Navajo Nation Workforce Training Initiative in the amount of$1 Mllion over five years inpartnership with SanJuan College in Farminglon andNavajoTechnical University in Crownpoint, and to contribute $150,000 to Four Costers EconomicDevelopment.

PASSED, APPROVED AND ADOPTED this 3'd day of September ,2073.

BOARD OF COUNTY COMIVIIS$ONERSoF SAN JUAN COUNTY, NEW MEXTCOBy:

Scott Eckstein, ChairmanATTEST:

Debbie Holmes, County Clerk

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Nenru Buelrpss-4sffi,HHffiffi?hffi*if,,,ii

,s-Hijf : August 20, zoLsh-BEffiHffiilffitr|ffi: Consideration of Resolution No. 13-14-19, Urging the EnvironmentalImprovement Board to Not Adopt any "Reglonal Haze Rule" State Implementatlon Planthat Involves Closing Units at San Juan Generating Stationffiffi: County Executive Office,ffi ,*: Kim Carpenter, County Executive Officeriffil.8ffi*E&i-$.}H,ffiffi: Approva| of Reso|ution No. 13-14-1efi.fti T(: Resolution No. 13-14-19 encourages the State of New Mexlco andthe Environmental Improvement Board to work toward a solution at the San JuanGeneratlng Station which would not result in shutdown of any of the irnits, as such ashutdown could further devastate the local economy.ffi: N/A itr-{g#lffifilBliirffis{ld: N/A,tr#i"H ., YES [ ] No t I#$,ffiffi8W,ffiY;f*t : Doug Echols, Deputy County AttorneyH.fddffiffi.ffi.iif : San Juan county Resolution No. 13-14-19BffiLf:F}f"Of,|ffi4-ffiflfr1ffiilti: Reviewed by: comments:tltxItItlI]I]tltl

Not ApplicableLEGALFINANCEPURCHASINGHUMAN RESOURCESPUBLIC WORKS

Comments:

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Scott DckstelnChalr:oilan.Iack FortaerChatmaa Pro TemKelth JohnsMember

Matgaret McDanlelMemterGlo.Iean TodaphaaneI,llenber

Mr. Klm J. CarpenterCoun6rErcorfiva Ofrlccr

1OO South Oliver DrhreAztec, New Mqdco 87+lO-Zt+32Phone: (505) 33+9481 Fa* (505) 334-3168www,sjcounty.net

SAN JUAIY COUNTY, NEW MEXICORESOLUTION NO. 13.1+19

URGING TIIE ENYIRONMENAL IMPROVEMENT BOARD TO NOT ADOPT ANY"REGIONAL HAZE RIILE'' STATE IMPLEMENTATTON PLAi\t (SIP) THATINVOLYES CLOSING UNITS AT THE SAN JUAFI GENERATING STATIONWHEREAS, the Environmental Protection Agency (EPA) has adopted

regulations regarding air visibility issues in this region which are sometimes referred toas the'R.egional Haze Rule"; andWIIEREA"S, these regulations require coal-fir'ed power planm in the region toinstall to reduce thE release ofparticulates which is referred to intheregulation$ as "Best Available Reftofit Technology" or BART; andWIIEREAS, the Regioral Haze Rule regulations required each state'senvimnmsntal agency to propose to the EPA a State Inrplementation Plen' (SIP) whiohwould detail the specifio requil'ements for power plants within the state that would meetthe BART requfuements; andWHEREAS, the original SIP for the San Juan Generating Station proposed byNew Mexico required all four units at the San Juan Generating Station (SJGS) to add

Selective Non-Catalytic Reduction or "SNCR" technology to reduco particulates, butthatplan was not approved by the EPA and the EPA then adopted a Federal hnplementationPlan or (tElP" which required installation of Selective Catalytic Reduction or "SCR"technology on all four units; and

WIIEREAS, the cost of installing SCR technology is so expensive (estimated byPNM to be as much as $750 million to $1 billion) that the operator of the plant, PublicService Company ofNew Mexico (PNM), appealed EPA's aotion to the federal courtsand asked the State of New Mexico to intervene andpmpose an altemative SIP with ahigher probability of being approved by the EPA; and

WIIEREAS, PNM, the State of New Mexico, and the EPA reached anAgreement in Principle (AIP) outlining a way of going forward that would avoid firtherlitigation and lead to adoption of a new SIP; however; the AIP contemplates a new"Altemative SIP" which would require the closing of two of the four units at SIGS; and

COUNTY

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ILIEREAS, the closing oftwo units at SJGS would also mean a massivereduction in the num.ber of high-paying jobs at PNM and at San Juan Coa[ Company, themine operator at the San Juan Coal Mine which supplies coal to SJGS, and the loss ofthese jobs would have atemeadous negative effect onthe local economy; and

WIIEREAS, San Juan County generally would be supportive of collaborativesoh:tions desigued to inrplement federal regulations in a way that the stakeholders cansrrpport; however, it also recognizes that the nation, state, and local region is struggling inthe wake of the recent general recession aud that San Juan County, its municipalities, andthe Navajo Nation are also feeling the negative economic effests of a downtum in nafuralgas production inthe area; and

WHEREAS, the Board of County Commissioners has weigbed these factors andhas concluded that it cannot support the AIP and the Altemative SIP which, if oarried out,would lead to loss ofjobs and a devastating effect on our stuggling regional economy.

NOW TITEREFORD, BE IT RESOLYED thatthe Board of CountyCommissioners of San Juan County, New Mexico, opposes the adoption of anyaltemative State Implementation Plan rvhich requires the closing of units at San JuanGenerating Station.BE IT tr'URTII-ERRESOLVED thatthe Board of County Commissioners urges

the New Mexico Environmental Board to consider the negative effects on the localeconomy that would be caused by the shutdown of units at San Juan Genorating Stationin its decisionmaking and to consider other solutions whereby all four units couldcontinue in operation and the related high-paying jobs at the power plant could bepresewed.PASSED, APPROVED AFID ADOPTED this 20e day of August, 2013.

BOARI} OE COT]NTY COMMIIISIO}{ERSox'sAN JUAN COTINTY, NEW MEXTCO

Scott Ecksteir:, ChairmanATTEST:

By:

Debbie Holmes, County Clerk