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The Environmental Protection Agency has proposed a new plan to clean the air in the national parks of Arizona; a move that could force the largest coal-fired power plant in the West out of business.
Owners of the plant fear that the proposal could push them into an unprofitable situation which would force a shutdown of the plant as soon as 2017.
George Hardeen, a spokesman for the plant, has admitted that “the critical issue is the timing of it. If the EPA requires it to be done within a short period of time, it becomes economically non-viable.”
The plant burns eight million tonnes of coal a year, and provides power to Arizona, Nevada, and California, as well as most of the power used in the Central Arizona Project, which supplies water to Phoenix.
The new EPA rules will require the installation of new pollution controls which are estimated to cost $1.1 billion. The owners of the plant say that it would be financially non beneficial to invest such a large sum when their lease for the land of the plant expires in 2019, and as of yet no deal has been agreed for an extension. Without a guarantee of that lease extension the money will not be invested and the plant will be closed.
Hardeen explained that, “you'd be putting a big expense out and not know if you'll be getting that expense back over time.”
By. Charles Kennedy of Oilprice.com
Charles is a writer for Oilprice.com