Port Jeff brainstorming options for power plant post-LIPA settlement

Port Jeff brainstorming options for power plant post-LIPA settlement

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The Port Jefferson Power Station may soon be repurposed. Photo by Alex Petroski

The Village of Port Jefferson is soon putting a lengthy legal battle with Long Island Power Authority in its rearview mirror, though the future of the property that houses Port Jefferson Power Station is still on the road ahead.

Bob Foxen, chief executive officer of Global Common LLC, a company dedicated to establishing energy partnerships and projects beneficial to its clients, was contracted by the village to study alternative future uses for the site. He presented options to the village board of trustees during a brainstorming session at a public meeting Sept. 17.

“I guess the goal is to try, to the degree possible, to make the people of Port Jefferson whole, or close to whole, assuming they lose some tax revenue,” Foxen said during his presentation.

Village Mayor Margot Garant expressed an interest for the village to formulate a plan of action for the site.

“Once we have our tax grievance settlement behind us, or we know that we’re at kind of a pause, the next question is ‘Now what?’” she said. “We want to advocate for a repurposing of the site to keep us viable on the grid.”

The village is among the municipalities preparing to imminently announce settlement terms with LIPA to resolve near-decade-long litigation regarding the property tax assessment of the plant, which the utility has argued is too high based on decreasing energy demand. Port Jeff has advocated for the refurbishment and repowering of its baseload plant to update its decades-old technology and to justify the property’s tax assessment.

By 2027, the power purchase agreement between LIPA and National Grid expires, and to resolve the tax certiorari challenges, LIPA negotiated with the village a nine-year “glide path” for tax revenue reductions to coincide with the agreement expiration, according to village attorney Brian Egan. The glide path includes gradual percentage reductions in assessed valuation on the property, deeming baseload repowering an unlikely future outcome. In addition, Caithness Energy LLC’s 2014 plans to construct a new 600-megawatt plant in Yaphank were revived temporarily by Town of Brookhaven’s town board this past summer, though the expiration of the company’s special-use permit for the site has put the plans back in doubt. If constructed, the Yaphank plant would further cloud the future of the Port Jeff plant.

Foxen admitted the options he brought ready to present during the meeting were dependent on Caithness II never getting off the ground, an outcome that is very much in doubt. The options also consider New York Gov. Andrew Cuomo’s (D) stated goal from 2016 that 50 percent of the state’s power come from renewable sources by 2030.

The consultant suggested turning the site into a 200- to 300-megawatt plant powered by peaking units or smaller energy generation systems capable of firing up only in times of high demand, as its best option. The units operate using gas or liquid fuel, though they are viewed as efficient supplements to renewable energy sources like wind and solar, which can’t handle demand on their own.

“I think it does help support renewables,” Foxen said of peaking unit plants, adding that financing the work needed to repurpose the site in this way would be hard to establish without a new power purchasing agreement with LIPA. Village officials are set to meet Sept. 20 with representatives from private Finnish company Wartsila to discuss the feasibility of installing peaking unit technology at the Port Jeff plant.

Foxen’s other brainstormed options included establishing the village as a municipal electrical utility, meaning it would assume control of energy distribution from the plant to customers to power homes, though he called the option costly and time consuming; and taking over energy distribution and limiting it to private customers at a reduced rate for businesses in specific industries that have high-energy demand, like data storage centers, for example, which could even be housed on the vacant site.

“It would be kind of an interesting magnet for a data center or somebody like that — saving money on energy might be a draw,” Foxen said.