In early 2019, the city manager of Farmington, N.M., delivered exciting news about the San Juan power plant, which at the time was set to retire in 2022. The city had hired a Washington law firm to market the aging coal-fired facility and within weeks, a little-known New York City hedge fund, Acme Equities, was chosen to transform and revitalize the plant.
The plan drew support from the federal government. Former U.S. Deputy Secretary of Energy Mark Menezes traveled to New Mexico to talk about the San Juan carbon capture project at a roundtable discussion with the hedge fund's development firm, Enchant Energy, and staff of the city Farmington, which is southeast of the power plant.
But less than two years after the meeting, that optimism has largely fizzled out. San Juan's majority owner and operator, PNM Resources Inc. utility subsidiary Public Service Co. of New Mexico, is planning on closing the last operating unit, the 507-MW Unit 4, by the end of September and is taking steps to demolish the facility as required by a 2021 county ordinance. The San Juan mine, which served the coal plant, stopped production earlier in September and is also set to close.
The San Juan plant is not the only carbon capture project receiving funds from the federal government that has struggled to become operational. With a lot more money coming, how the U.S. government allocates it will be critical.