The Cholla Power Plant outside Joseph City, Arizona.

The Cholla Power Plant outside Joseph City, Ariz.

Arizona Public Service will study the conversion of the Cholla Power Plant from coal to biomass produced by thinning millions of acres of forests in northern Arizona.

“A conversion at Cholla would ultimately assist in forest thinning, thereby reducing wildfire potential, ensuring forest health and protecting our watersheds,” said Barbara Lockwood in a letter to the Arizona Corporation Commission.

The power company’s announcement could lead to a breakthrough in the stalled effort to reduce wildfire risks and boost forest health by thinning the tree thickets that threaten every community in northern Arizona with crown fires. Converting the 60 megawatt plant to wood would support the clearing of about 30,000 acres of overgrown forest annually.

Cholla, in Joseph City in eastern Arizona, is ranked as the eighth most polluting power plant in the nation and was slated for closure in 2025. It emits 8,000 tons of carbon dioxide, 21,000 tons of sulfur dioxide and 15,000 tons of oxides of nitrogen annually. One study said the emissions contribute to 25 deaths, 39 heart attacks and 460 asthma attacks annually.

Currently, the 30 megawatt Novo Power Plant in Snowflake is the only biomass power plant in Arizona. It consumes the wood scraps gleaned from the clearing of about 15,000 acres annually.

Backers of the Four Forest Restoration Initiative (4FRI) had asked the Arizona Corporation Commission to require the state’s utilities to buy at least 90 megawatts of power from biomass annually, which could make the clearing of some 50,000 acres annually economical.

APS had done an earlier study on biomass power, which concluded building a new 30 megawatt biomass power plant would cost $100 million, while a 50 megawatt plant could cost $500 million. In that study, APS said it would have to raise the average homeowner’s electric bills by $1 to $4 a month to cover the cost of building a plant from scratch.

However, the APS press release said refitting Cholla would likely cost much less and take place more quickly.

The 4FRI project calls for thinning some 2 million acres at a pace of about 50,000 acres annually. However, the project has only thinned about 15,000 acres in the past eight years. One big problem remains the lack of a market for the thousands of tons of biomass from saplings, branches and brush growing in thickets on almost every acre.

The conversion of Cholla from coal to biomass could have significant benefits from APS, providing the utility can count on a reliable, long-term guarantee of a wood supply. Coal is one of the most polluting power sources, both in terms of human health and production of heat-trapping greenhouse gases. Federal clean air laws threaten to shut down the plant in the next few years. Burning coal has also gotten more expensive than other energy sources, especially natural gas. However, burning wood scraps is considered “carbon neutral.” That’s because the trees will die and decay or burn in the short-term anyway. Thinning the forest might even remove carbon from the air, since it promotes the growth of the remaining big trees — which can lock up carbon for 800 years. By contrast, burning coal and oil releases carbon into the air that has been buried for millions of years.

“It is suggested that biomass should be subject to a renewable energy carve-out equal to or greater than 60 MWS for affected utilities,” said the APS statement.

The APS statement left many key issues unclear, which is why the giant utility with more than 1 million customers will spend the next 60 days on a feasibility study.

The release didn’t estimate the cost of retrofitting the plant and whether it would have an impact on electric bills.

It’s unclear what impact converting Cholla would have on the existing, 30-megawatt Novo Power Plant in Snowflake. Currently, the plant has a four-year contract to provide power to APS. But if the Corporation Commission doesn’t require utilities to buy the full 90 megawatts, a 60-megawatt APS plant could end up putting the existing Novo plant out of business. St. Johns and Snowflake are just 45 miles apart. The 4FRI project area stretches from the Grand Canyon to Alpine.

It’s also unclear whether the 4FRI contractors could make money trucking millions of tons of biomass to Cholla in St. Johns, especially from the western half of the 4FRI project area. Already, White Mountains thinning contractors are lobbying the state to lift weight limits on logging truck loads, since it’s costly to make extra trips to haul the low-value biomass material.

The APS release made it clear the conversion of Cholla would depend on long-term contracts for biomass with “third party” loggers.

The Forest Service is currently near the end of an environmental study of 1.2 million acres in the Rim Country project, covering forested areas from Payson to Show Low. The current 4FRI contract still has hundreds of thousands of acres to thin in the first phase of the 4FRI contract, which was focused on the Flagstaff area. Congress recently authorized 20-year contracts in an effort to boost such long-term, thinning contracts.

Lockwood said, “These suppliers would likely need to be awarded long-term contracts with the U.S. Forest Service, or its agent, in its upcoming RFP for sufficient amounts of feedstock to operate the plant a minimum of 20 years.”

Lockwood concluded the company will file a report within 60 days. “If the analysis shows that the Cholla conversion is more cost-effective than other alternatives, we will propose to move forward with the project with the ACC’s approval at a date to be determined pending the results of the evaluation.”

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