Niagara Gazette — SOMERSET — The Somerset Power Co. was going full blast for environmental testing last week while company officials outined coal-burning plant issues to a tour of local officials
The former AES coal-burning power plant is the biggest taxpayer in the county.
Jerry Goodenough and Jack White, who manage the Somerset plant, as well as the Cayuga coal plant down state, explained the history of bankrupt AES and the challenges facing the new “Somerset Operating Co. LLC of the Upstate New York Power Producers.” Somerset Town Supervisor Dan Engert, Legislator John Syracuse, and Hartland Town Supervisor Ross Annabel talked of the town and county’s predicament. Assemblywoman Jane Corwin and former legislator Gerald Farnham and Paul Bologna, who are on Corwin’s staff, also sat at the table.
The group discussed roadblocks the coal plant has had to navigate.
One of them is the Regional Greenhouse Gas Initiative. Members of the group at Somerset said RGGI is endorsed by environmentalists and penalizes coal and gas-fueled power producers in favor of solar and wind energy. Since RGGI was adopted, AES has been on a down slide, according to the plant managers.
The group instead endorses the state’s Energy Super Highway efforts — which Gov. Andrew Coumo is pushing — to get electricity from upstate sources to downstate customers — principally New York City. The energy highway would update the infrastructure with a billion-dollar effort.
However, the state is also considering a project to pipe power downstate from Ontario through the Hudson River or bringing electricity in from New Jersey. The Garden State opted out of RGGI, giving New Jersey an advantage.
Engert said that RGGI, shifted the burden onto the taxpayer. The town has had to renegotiate its Payment in Lieu of Taxes agreement (PILOT) three times with the AES. With AES payments down, school, county and town taxes go up.
There is an effort for full repeals of RGGI and Corwin said withdrawal from the compact is possible. Environmentalists are fighting to save it.
“It hurts New York state business,” said Goodenough who is chief operating officer for the new endeavor. “It has had a reverse affect.”
Goodenough has met with the state officials and came away with the feeling that the energy policy is trumped by environmental issues.
The group talked about “fracking,” a controversial way to get natural gas from deep underground sources. Pennsylvania profited but has environmental problems. New York state proponents say they will do fracking the right way, without polluting the water.
According to Engert, New York state has the fourth highest electrical rates in the country. He wants coal as part of a diverse energy portfolio. The supervisor said their investors believe in the Somerset plant.
According to the new company, which is owned by bondholders, the long-term success of the Somerset facility depends on its place in the Energy Super Highway.
“We need diversity,” Corwin said. “We don’t want coal to be forgotten.”
Corwin, who was elected to the state Assembly in 2009, was impressed with the cleanliness of the plant and wants to keep it up and running.
Corwin added she has investigated fracking. “Pennsylvania didn’t do it right. New York state is different,” she said.
White, who lives in Barker, has looked into fracking water. “Fracking can be done safely,” he said.
Bondholders of the new company have committed an additional $70 million investment to operate the Somerset plant.
According to the Upstate Power Producers fact sheet, the Somerset plant is an important source of energy diversification and an important buffer to price shocks from volatile natural gas prices.
The plant is clean and the largest coal plant in the state.FACT SHEET Somerset has 120 employees with a 2011 payroll of $15 million. The union employees voted to accept a new contract in July. PILOT money pays 80 percent of the town tax base; 70 percent of the school tax base and 5 percent of the county tax base