Energy Firm Plans $750M Power Plant

The venture, which the company estimates will create approximately 400 construction jobs during the two-year to two-and-a-half year construction phase, is being proposed at a time when New York State does not have a power plant siting law in place. Once completed, the company will employ 20 to 30 workers to operate the plant. The state's Article X power plant siting legislation lapsed in Jan. 2003 and state legislators have failed to pass enabling legislation since then. Therefore the Competitive Power Ventures proposal must obtain local, state and federal approvals before construction can begin. Company officials say the firm has a long-term option to acquire the property but did not supply further details on the contracted price for the land or the seller of the property.

The lack of a power plant siting law, combined with a volatile financing climate in the aftermath of the Enron scandal, as well as local opposition caused at least three large scale energy projects in Rockland and Orange counties to be shelved in the past five years or so. Peter Podurgiel, SVP with Competitive Power Ventures, says the New York State Independent System Operator has targeted the Hudson Valley as being in need of additional generation facilities to meet future needs.

The power plant will be supplied natural gas from a proposed extension of the Millennium Gas Pipeline that is now under construction. The plant will then supply electricity to the region via the existing Marcy South power line system, he says. Podurgiel adds that Millennium's owner will be filing an application for the seven-mile extension of its power line to the project site with the Federal Energy Regulatory Commission.

He says the lack of a power plant siting law did not have an impact on its decision to move forward with the project, and notes that the company is pleased that the Town of Wawayanda's Planning Board after a recent work session has deemed itself to be lead agency as the project is engaged in the state's environmental review—SEQRA--process. Company officials say they are scheduling the plant to go on-line sometime in 2012, which is when the New York State Independent System Operator has stated the Hudson Valley region will need additional energy supply.

"We believe that allows for adequate time to gain the approvals and adequate time to construct the project," Podurgiel says. The company is calculating a 30-month time frame for construction. To meet its planning opening schedule, the firm would need all approvals in hand in about an 18-month to two-year time frame.

While the company did not provide the actual size of the proposed plant, the facility will feature a 120-foot tall turbine building and stacks that will be about 250 feet high. Produrgiel says that the firm plans to file an application with the Orange County Industrial Development Agency to secure mortgage and sales tax incentives in connection with the project and is also looking to hammer out a Payment in Lieu of Taxes arrangement with the agency. The company is looking for a PILOT deal that would call for the firm to pay approximately $30 million in taxes over a 22-year period, a company official said.

Competitive Power Ventures, which also has offices in Boston and San Francisco, currently manages 14 power plants across the country that produce more than 8,000 megawatts of power for third parties. The firm also manages wind power generation facilities that harness approximately 3,500 megawatts of power. The Wawayanda project would be the first plant the company will develop and own. The company is looking to propose approximately 5,000 megawatts of new development power plant projects in the next two years. In New York State, the company manages one of the newest energy plants in the state--Athens Generating, a natural gas power 1,080-megawatt plant in Athens, NY, about 30 miles south of Albany that went on-line in 2004.