ITHACA, N.Y. — There have been at least three big developments in the fate of the Cayuga Power Plant this week.
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(New to the topic? See our explainer: A beginner’s guide to the Cayuga power plant’s future.)
1) “Mothballing of Dunkirk”
News came on Tuesday that a plant outside of Buffalo — one in a similar situation to the Cayuga Power Plant — is going to be taken offline starting in January.
That could have big repercussions for coal-fired plants, like the one in the Ithaca area, that have sought to retrofit their facilities (and remain open) by converting to natural gas.
Gov. Andrew Cuomo has given mixed signals about whether the state will support the plants’ conversion to natural gas over objections that renewable energy alternatives be pursued instead. The Dunkirk plant outside of Buffalo seemed to give supporters of the Cayuga plant reason to be optimistic; in 2013, the governor announced that the plant would be converted to natural gas and remain open.
Now, however, the plant’s future is much less bright — and that has some observers thinking the Cayuga power plant’s days are numbered as well.
“The mothballing of Dunkirk could also have a cascading effect on other struggling power plants that fit a nearly identical profile.”
“Cuomo has avoided interfering in the proceedings over the fate of the Cayuga plant outside Ithaca — which is currently being subsidized by ratepayers for about $4 million a month and is seeking a deal similar to the one the Cuomo administration had arranged for Dunkirk to remain open. The (Public Service Commission) is now weighing Cayuga’s fate, which could be darker in a New York that no longer includes Dunkirk.”
2) Second plant to close
More bad news for those hoping the Cayuga power plant stays open: On Tuesday, another Western New York coal-fired plant announced plans to close by March 2016.
The Huntley Tonawanda coal facility, run by the NRG energy company, “could start laying off staff there on Jan. 1,” according to Buffalo Business First.
“According to NRG (NYSE: NRG) spokesman David Gaier, sustained low natural gas prices, low energy prices and low capacity prices are behind the plans to close the Huntley site.
“…The plant’s been losing money,” Gaier said. “We’ve hung in there and tried various things. But we could not make gas conversion work. We studied that as recently as this month. It just won’t work. Low natural gas, energy and capacity prices make the plan economically unviable.”
Those findings are likely to provide additional fodder to those who say the Cayuga power plant’s retrofitting plans are untenable and unrealistic.
Correction: A previous version of this story incorrectly attributed parts of the IEEFA report to EarthJustice.
3) Groups oppose bailout
Meanwhile, the Cayuga power plant has faced renewed criticism from those who say alternatives put forward by NYSEG would be less damaging to the environment and save ratepayers millions of dollars. (The plant has said the energy needs of the area may not be met if it is forced to close.)
“Numerous resources are available to mitigate impacts to the tax base and economic development in the Lansing area in a less risky and far less costly manner than compelling ratepayers to significantly underwrite repowering of the Cayuga plant,” wrote a report from the Institute for Energy Economics and Financial Analysis.
“The IEEFA report concluded that, under all sets of assumptions, the Cayuga plant is not profitable absent continuing ratepayer subsidies,” the report said.
“Analyses conducted by both NYSEG and Cayuga highlight the need for the full suite of transmission upgrades proposed by NYSEG.”
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