Image: WildEarth Guardians via Creative Commons license

As a result of an early analysis saying the economics make sense, New Mexico’s largest utility said it is considering the early retirement of the remaining coal-burning units at is San Juan Generating Station. The analysis, conducted as part of Public Service of New Mexico’s resource planning process, shows that shutting down units in 2022 “could provide long-term benefits to customers” and create an opportunity to “to increase renewable energy production and add operational flexibility.” Although only a preliminary finding, the announcement signals a shift in PNM’s long-held position that continuing to operate the San Juan power plant was the most cost-effective option for the company, its shareholders and customers. PNM is on track to shut down two of the plant’s four coal-burning units by the end of this year and replace the power with electricity generated by natural gas units and nuclear, solar and wind power. The 2022 shutdown date coincides with expiration of the utility’s coal contract and a partnership agreement with other utilities to operate the plant. PNM is the largest stakeholder in the plant, owning 66.4 percent of shares. Reclamation costs for the mine that supplies the plant with coal, which PNM is responsible for, were estimated at $133 million in 2012 dollars. The decommissioning costs for the plant are estimated between $30 million and $150 million, according to public documents.

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