The Navajo Nation introduced legislation late Wednesday to extend the lease on the coal-fired power plant near Page so that it can operate through 2019. (Photo: Mark Henle/The Republic)

The Navajo Nation introduced legislation late Wednesday to extend the lease on the coal-fired power plant near Page so that it can operate through 2019.

Salt River Project and the other power plant owners have agreed to a deal allowing the tribe access to the water pumps that suck water from Lake Powell to cool the Navajo Generating Station and to portions of the power grid, once the plant eventually closes.

SRP and the other utilities that own NGS have said they want to close by 2020 because the plant is no longer cost-effective compared with other power resources, primarily natural gas.

The current lease ends in December 2019, and the utilities want to run it to that point and then begin tearing it down, which will take more than a year.

The lease extension spelled out in the legislation would allow for the post-2019 teardown. If the tribe doesn't approve a lease extension by July 1, the plant will have to close this year to be torn down by 2020.

MORE: NGS' power lines could benefit solar, wind development, energy experts say

Financial benefits for tribe

The Navajo Nation will earn $110 million in lease payments over 35 years if the deal is approved, as the owners will be required to monitor the land after the facilities are removed. But the deal includes other financial benefits for the tribe.

The Navajo Nation has identified several pieces of the operation it wants to keep when the plant closes, according to the legislation. They include the railroad between the plant and coal mine, valued at $120 million; the lake pump facility and electrical switch yard, valued at $41 million; and access to major transmission lines leading from the plant, which SRP values at about $80 million.

The access to the power lines would allow for solar or wind projects on the reservation to get their power to market.

The tribe hopes to negotiate with the state to acquire 50,000 acre-feet of water from the lake annually once the power plant no longer uses that allotment.

If the Navajo Nation Council approves the deal by July 1, any amendments the tribe makes will have to be considered and approved by the plant owners.

RELATED: When coal-fired power plant closes, this mine will die. So will a lifeline for one Native American tribe

Future of Kayenta Mine

Meanwhile, Peabody Energy, which runs the Kayenta Mine that supplies the plant with coal, is hoping to find new buyers to step in and keep the plant running so it doesn't need to be torn down after 2019.

The power plant and mine combined employ about 750 people, almost all Native Americans from the Navajo and Hopi tribes.

In order to transfer the plant to new owners, should any be found, SRP has set a deadline of Oct. 1 for such a deal to be approved.

SRP and the plant owners also have agreed to buy enough coal from the mine in 2018 and 2019 that the tribe will earn $39 million in royalties.

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