Sunday, April 2, 2023

Once the Coal Plant Closes

Fueling New Mexico's Rural Transition Economy


The state's economy is getting hit hard and fast as more coal plants are scheduled to close and many rural economies are poised to evaporate. Rural communities in the state are trying to figure out what to do to keep their economies from sinking. If you live within a hundred miles of a coal plant, chances are you work at the mine that fuels the soon-to-be-extinct plant, or you depend on its workforce’s income to fuel your business.

Since the New Mexico Energy Transition Act (ETA) was signed into law in 2019 with carbon-free mandates, what to do about the livelihoods of people in affected communities has been a principal concern. Coal has been the main economic force for decades in the Four Corners area and surrounding counties. The coal-burning energy plants that are shutting down are a major source of air pollution and greenhouse gas emissions, including monoxide and heavy metals like mercury. Using coal also releases sulfur dioxide, a harmful substance linked to acid rain.

The most challenging aspect of the carbon-free transition that federal and state administrations face is what do you do about the unemployed fossil-fuel driven workforce while making sure the economies in coal towns are not left behind? The timing of Deb Haaland’s appointment as the first Indigenous person to lead the U.S. Department of the Interior couldn’t have come at a more opportune time. The agency plays a key role in governing public lands and Native American affairs. The appointment holds immense meaning for the 1.9 million Native Americans who now have a leading seat at the federal table.

When the Navajo Generating Station near Page, Ariz., shut down in November 2019 marking the end of an era, the lifeline that was providing the Hopi Tribe with yearly royalties of $12 million, or 80 percent of the tribe’s budget, disappeared. Navajo and Hopi Tribes have been scrambling to find new sources of revenue as additional coal plant closures loom on the horizon. The rural communities of New Mexico are saddled with a limited capacity to evolve their economies and present complex labor market challenges for climate change policies.

“There's a lot of transitioning happening,” said Arvin Trujillo, chief executive of Four Corners Economic Development group. “We're looking at how we take the challenges we have and begin to look at more positive aspects. And how do we get the full region to begin to work together?”

Regional officials in areas affected by energy transition are focusing on rebranding themselves while promoting tourism, recreation and a retirement economy as economic alternatives. At the same time they’re working to ensure these areas have reliable internet and other infrastructures to encourage data centers, manufacturing and other businesses to relocate. Coal power can no longer compete with the sustainability and clean energy potential of renewable energy. New Mexico Commissioner of Public Lands Stephanie Garcia Richard said the economic effects of the coronavirus have strengthened her dedication to shifting New Mexico away from its reliance on fossil fuels. “These coal plants have had a hugely detrimental effect on our ability to compete because of our pollution here,” Garcia Richard said.

There are job opportunities for many years decommissioning coal plants and mines, land reclamation, the utilization of assets such as power lines and substations, and utilities with replacement power needs. Initially, there will be jobs in the reclamation of coal-generating stations as workers will be needed to clean up contamination at the plant and the surrounding areas. In the mining area, the long-term work of restoring the land and vegetation and doing environmental monitoring will need to be done.

Decommissioning and reclamation could result in repurposing existing facilities and power infrastructure for other industrial and manufacturing uses and provide transition and longer-term job opportunities. Sustainable energy jobs and installation of wind and solar present another opportunity to diversify the rural economic base in New Mexico. Renewable energy’s investment pace has greatly increased as its efficiency rises and the cost of technologies falls.

There has been a significant drop in the cost of solar in the past several years. In 1977 the average global price of installing solar panels was $76.67 a watt. Solar photovoltaic module prices have dropped by 89 percent since 2010. Solar PV prices should drop by another 34 percent by 2030. By 2050 those prices could drop by a total of 63 percent. This means utility-scale PV could cost only 2.5 cents per kW-h.

The low-range salary for industrial or residential solar installers is about $24,000. With experience, a solar installer can make well over $50,000. Canvassers are typically paid $15 per hour (base salary) plus $50 per appointment and $1000 commission draw for the first month. Solar sales reps can have a $50K base plus $350 to $500 per kW (depending on price sold) or a $50K base with a flat $1000 per sale of solar PV.  

The Bureau of Labor Statistics projects 60.7 percent employment growth for wind turbine technicians between 2019 and 2029. The median annual wage for wind turbine technicians was $52,910 in May 2019. The highest 10 percent earned more than $80,150. Most wind turbine service technicians learn their trade by completing a two-year technical program. On-the-job training is provided by employers and typically lasts over 12 months, during which wind technicians install, inspect, maintain, operate and repair wind turbines. Besides the technical aspect of working on turbines, from hydraulics to composites, the profession also offers benefits, as well as the ability to travel. The inclusion of funding in the ETA law addressing workforce training and prioritizing the most directly affected communities is a resource that, if invested wisely, can help New Mexico make a smooth transition toward a green energy-based economy.

Coal communities face pressing economic, health and environmental problems. It will take state and federal support combined to build equitable and sustainable economies in places affected most by the shifting energy economy. Affected communities don’t have much time to come up with a new way of making money.


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