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With NatGas Backing, Los Angeles Moves Further From Coal

The Los Angeles Department of Water and Power (LADWP), the nation's largest municipal utility, has accelerated its move away from out-of-state coal-fired electric generation, moving up to last Friday its discontinuation of supplies from the Navajo Generating Station in Arizona.

Its new agreement with Phoenix-based Salt River Project (SRP) for 477 MW of Navajo's coal-fired generation output will allow the multi-billion-dollar city-owned utility to meet California climate change goals ahead of schedule and reduce the city's portion of coal-fired power until it phases it out entirely in 2025.

Three years ago, LADWP launched a zero-coal push when it and the SRP began negotiations, with the goal of ending LADWP's 21% stake in the 2,250 MW coal-fired Navajo facility near Page, AZ, by the end of 2015 (see Daily GPIApril 19, 2013). That has now been accomplished, effective July 1.

LADWP's sale of its Navajo share will cut its greenhouse gas (GHG) emissions by 5.39 million metric tons (mmt) over the next three and a half years, equivalent to taking one million cars off the road in Southern California, according to the utility.

"The crisis of climate change demands that we take action now to end our reliance on coal," said Los Angeles Mayor Eric Garcetti. "Divesting Navajo is a major step toward reducing GHG emissions and securing LA's clean energy future."

LADWP will make up for the Navajo volumes with power from renewable resources and energy efficiency, backed up by natural gas, LADWP said. "The back-up natural gas power resource is located outside of the Los Angeles Basin and is unaffiliated with the [closed] Aliso Canyon gas storage facility."

LADWP now has reduced its percentage of reliance on coal-based electricity from 40% to 30%. The city councilman chairing the energy/environment committee on the council, Felipe Fuentes, called the Navajo divestiture a "smart, strategic move that will benefit the city for future generations."

Marcie Edwards, LADWP general manager, said the exit from the Arizona coal-fired power source was years in the making, and took extensive coordination with all of that power plant's participants. "We reached a milestone -- the closure of one more chapter in transforming the city's energy portfolio."

The sale to SRP had been signed a year earlier, but it was subject to a variety of closing conditions.

LADWP is in line to get about $15 million and 158 MW of transmission system capacity rights that will be used to import more renewable power.

There is one remaining coal-fired power source in the LADWP portfolio, the mammoth Intermountain Power Project (IPP)  in Utah, from which it takes a major portion of power. "LADWP is currently in discussions to replace coal generation at that facility with cleaner resources by 2025," a spokesperson said. Natural gas-fired generation is one option.

Three years ago LADWP talked about developing as much as 500 MW of natural gas-fired generation at IPP, but nothing concrete has ever come of those plans.

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