Today, U.S. Senator Charles E. Schumer personally called the new chair of the Public Service Commission (PSC), Aubrey Zibelman, to urge the PSC to adopt a plan to repower the aging coal-fired Dunkirk NRG Plant into a natural gas-powered plant, which is the cleaner energy option, protects taxpayers and will create hundreds of construction jobs. Zibelman's chairmanship was effective as of Tuesday, September 3rd, and Schumer called to make clear that the repowering of the NRG plant should be a top agency priority.
Currently, the PSC is evaluating two proposals regarding the future of the Dunkirk NRG Plant: an upgrade to transmission and delivery systems that would result in the plant coming offline or a complete repowering of the plant to burn natural gas instead of coal. In a personal call to PSC Chair Zibelman, Schumer argued that the plan for transmission upgrades is a short-term fix that would likely only resolve the reliability needs for a few years and would leave the local community in deep financial distress.
Schumer explained that repowering the Dunkirk NRG plant is a more cost-effective and environmentally-cleaner solution that would ensure the plant's viability over a much longer period and hence protect its tax contributions to the city, county, and school district, and prevent a much larger tax hike for Dunkirk-area homeowners, predicted to be around $1,000 each. Furthermore, the repowering plan is projected to create 500 construction jobs over the next 3 years. If the NRG Plant closes, city taxes are expected to double and county taxes would rise significantly. Schumer therefore urged Zibelman and the PSC to swiftly approve the repowering plan at its upcoming approval meetings.
In early August, Schumer stood with local officials, Chautauqua County Chamber of Commerce representatives, and local labor leaders to announce his support of the repowering fix. Schumer also wrote the acting chair of the PSC at the time, Chairman Brown, to explain his arguments in favor of rebooting the Dunkirk NRG Plant to burn natural gas.
"This week, Ms. Aubrey Zibelman took over as chair of the PSC, and I called her to emphasize my belief that the repowering of the Dunkirk NRG plant should be at the top of the PSC's "to-do' list," said Schumer.
"As I have said before, the repowering fix is clearly the most long-term, cost-effective solution for the city of Dunkirk and Chautauqua County. Repowering to natural gas ensures the plant's economic viability, is better for the environment, provides an efficient and cleaner form of energy, and protects the plant's tax contribution. And with a new chair of the PSC, I will keep my foot on the gas to advance the effort to get this done," said Senator Schumer. "Upgrading the transmission lines is simply an investment in dirty out-of-state production and does not solve the underlying financial concerns that have put the NRG plant on the chopping block. For residents who face a steep tax hike if the plant were to be unplugged, that provides inadequate relief. We have the power to create a brighter future for the NRG power plant and the residents of Dunkirk if we make the investment today to repower the facility for the future."
The Public Service Commission is currently facing two proposals in light of the reliability issues that were found in the mothballing of the NRG plant, and will approve one of the two plans and the corresponding rate increase to pay for the plan in the next few months. They can either approve a Transmission & Delivery (T&D) fix or a Repowering fix. The T&D fix, proposed by the utility company National Grid, is reported to cost $160M, but National Grid acknowledged that it could be much higher than that, and some experts have commented that National Grid vastly deflated the costs of their proposal. The fix involves upgrades to a transformer station in Cattaraugus County, upgrades to power lines, and buying more expensive, dirtier, coal-produced power from Pennsylvania. This proposal could lead to the closure of the NRG plant in Dunkirk which would have a devastating impact on the local community. NRG annually contributes an average of $40 million to the community and has invested $227 million on plant upgrades. The money that flows from NRG provided nearly 25% of Dunkirk city's revenue in 2012 and helps pay the cost of schools and public works, all of which is at risk if the plant is forced to close.
Schumer highlighted that upgrading the transmission and delivery of power is a short-term fix that doesn't address the underlying problem--the weakness of coal-fired energy in the developing energy market. T&D upgrades are only budgeted until 2021, when new action and new costs would likely be required. Moreover, the T&D fix relies on the viability of coal power plants in Pennsylvania, which will come under increased pressure to close as new environmental regulations go into effect in 2015.
In a call to the new acting chair of the PSC, Schumer reiterated his support for the second alternative being considered by the PSC, repowering the facility to burn natural gas, which ensures NRG's continued presence in the community and solves the issue of sustainable energy development. If revamped, the power plant would be more environmentally-friendly and bring 500 construction jobs to the area. The $550 million plan invests in long-term energy development in New York State, rather than in Pennsylvania, by creating a state-of-the-art natural gas energy facility in Western New York. In addition to protecting the Chautauqua County tax base, and creating jobs in New York State, the repowering fix would also ensure the long-term viability of available power in Western New York, rather than relying on the unpredictable Pennsylvania coal plants. The repowering fix has wide support from the local community, and elected officials.