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Source: The Lansing Star

More Power Plant Comments, But No Decision Yet

BY DAN VEANER

Posted: August 31, 2015
Originally Published: August 28, 2015

With the decision still pending on whether the coal-burning Cayuga Power Plant will be repowered with natural gas, attorneys for Cayuga Operating Company, LLC (COC) and Sierra Club, Ratepayer and Community Intervenors, Environmental Advocates of New York, and Citizens Campaign for the Environment on Repowering Options for Cayuga Generating Facility filed comments with the New York State Public Service Commission (PSC) this week. Additionally, Entergy Entities, which owns nuclear and traditional power plants around the country, filed their own comments opposing repowering the Lansing plant.

There are few surprises in the comments submitted. COC says repowering the plant will reduce ratepayers' bills, while opponents claim ratepayers will pay more. Perhaps the most surprising comments were submitted by Entergy Entities, which owns four nuclear plants and four traditional power plants including one in Owego, NY and one in Buchanan, NY. Entergy supported NYSEG's plan, but said that whether the PSC agrees or not, its authority is preempted by federal regulations.

"The PSC is preempted by the FPA (Federal Power Act) from approving the contract requested by Cayuga to subsidize the repowering and ongoing operation of the facility," said Entergy's attorney, who goes on to say, "Under the FPA, the FERC (Federal Energy Regulatory Commission) has exclusive jurisdiction over Cayuga's requested contract under both field preemption and conflict preemption principles."

COC stressed benefits to the community, including well paying existing and new jobs, maintaining capacity, maintaining the ability to power the plant with either natural gas or coal, depending on which is more beneficial at any given point in the fluctuating financial landscape. COC says repowering will create up to 400 union construction jobs, continue to contribute at least $4 million dollars to the local economy annually through purchases of goods and services, provide stable tax revenue for the local schools and government and improve the quality of life and economy in the area, and provide environmental benefits through significantly-reduced air emissions and a lower carbon footprint by using clean-burning natural gas.

The company says NYSEG's plan "offers no additional benefits outside of addressing the reliability need."

Plans for improving electricity delivery have been under review by the PSC for about two and a half years. While many opponents of repowering have argued that alternative energy sources should be considered, only two have been on the proverbial table. COC has proposed its plan to repower the two-unit, approximately 312 megawatt coal-fired plant with natural gas. New York State Electric and Gas Corporation's (NYSEG) put forth its own plan to upgrade transmission lines. After much public comment NYSEG and COC were directed to formulate a mutually agreeable plan, but after eight months the companies announced that they were unable to do so despite good-faith efforts to do so.

Anther extension was granted so that COC could submit a new, revised plan of its own, which has been under consideration for most of this year.

"The Revised Repowering Proposal is in the public interest and consistent with State's codified policy on electric generation repowering (Part Y Legislation), the Blueprint, the Commission's Repowering Order, and the Commission's order approving the repowering of the Dunkirk Facility," COC attorneys argued. "Specifically, repowering the Cayuga Facility will satisfy the identified reliability needs in the area, enabling NYSEG to meet its obligation of providing reliable electric service in its service territory."

Sierra Club, Ratepayer and Community Intervenors, Environmental Advocates of New York, and Citizens Campaign for the Environment on Repowering Options for Cayuga Generating Facility submitted a 74 page document arguing the plant should be closed.

"Approval of Cayuga's Revised Repowering Proposal would be arbitrary, capricious, and contrary to the Commission's obligation to provide 'safe and adequate service' at 'just and reasonable rates,' because the Revised Repowering Proposal would expose ratepayers to a number of unnecessary reliability risks and saddle ratepayers with unjust, unreasonable, and unnecessary costs that largely could be avoided with the completion of NYSEG's proposed transmission upgrades," their comments read.

Their comments detail arguments that current reliability analyses conducted by both NYSEG and Cayuga highlight the need for the full suite of transmission upgrades proposed by NYSEG regardless of whether generation is retained at the site of the Cayuga plant and claim that the transmission upgrades will fully resolve reliability issues in the area over the next 10 years. That, they say, would eliminate the need for the power plant to operate at all.

"It is likely that the economically unsound Cayuga plant would retire either during or shortly after the term of the Revised Repowering Proposal," the attorney says. "As such, after paying the $49.5 million cost of adding gas capacity to the Cayuga units, and $9.6 million per year in operating subsidies, ratepayers could very easily be faced again with having to fund transmission upgrades or further subsidize the plant."

The document also claims that the repowering proposal "runs directly contrary to the goals of the Reforming the Energy Vision process by seeking to require customers to pay $145 million to subsidize the continued operation of a nearly 60-year old, uneconomic coal-fired power plant, half of which has been broken down for the past seven months. The proposed addition of natural gas capacity to the aging plant similarly runs counter to the REV process as the Commission has recognized that a shift toward greater reliance on natural gas."

COC argues that repowering the plant conforms to the New York Energy Highway Blueprint.

"Among its conclusions, the Blueprint states that "repowering power plants can improve system reliability . . . [and] provide environmental benefits to New York State through reduced emissions and the use of previously developed land with transmission infrastructure already in place," reads the COC document.

Local government and plant officials say they do not know when the PSC will make a decision. Some thought a decision would be forthcoming after a February deadline, but more extensions were granted for revised plans and new comments.

Proponents and opponents alike have been rallying to their causes, sending comments to Albany. Earlier this year Tompkins County Legislator Mike Sigler sent a petition to Albany in favor of repowering. On Monday Fossil Free Tompkins delivered more than 10,000 comments urging Governor Cuomo and the PSC to close the plant and approve "necessary, cheaper and more reliable transmission upgrades."