L.A.'s move from coal could cost more than $600mn

LADWP Los Angeles Mayor Antonio Villaraigosa end coal Navajo Generating Station Arizona Intermountain Power Plant Utan

A Los Angeles Department of Water and Power ratepayer advocate said Los Angeles Mayor Antonio Villaraigosa’s plan to stop using coal-fired energy in the city could come with a price tag of more than half a billion dollars, according to a report from the Los Angeles Times.

Speaking at a meeting of the L.A. City Council’s Energy and Environment Committee earlier this week, LADWP Ratepayer Advocate Fred Pickel said removing coal from the city’s mix of power sources earlier than a state-mandated deadline would create costs of more than $600 million, according to the Times. Pickel said the effect that would have on electric bills in the city is unclear.

Currently, the city receives about 39 percent of its power from the Navajo Generating Station in Arizona and the Intermountain Power Plant in Utah. LADWP is expected to sell its share of the Navajo Generating Station to the Salt River Project by the end of the year, and the LADWP has already approved an amendment to its contract with the Intermountain Power Plant that would switch the power supplied to Southern California utilities from the coal-fired plant to a smaller natural gas-fired plant. The move to the natural gas-fired would begin in 2020 and be completed no later than 2025, taking the city completely off coal-fired power two years earlier than required by California.

Pickel warned, however, that selling the city’s interest in the Navajo Generating Station three years ahead of the current contract’s termination date is projected to cost $150 million to $200 million, the Times reported. In addition, the cost of using natural gas-fired energy from the Intermountain Power Project near Delta, Utah is projected at nearly $500 million.

According to the report, Pickel said the city should consider looking for cheaper, alternative sources of electricity to lessen the impact of rate increases, adding that one option could be to purchase more solar energy.

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