LIPA report: Barrett plant overhaul not cost-effective

Study cites power surplus on Long Island

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An overhaul of Island Park’s E.F. Barrett Power Station would not make economic sense, according to a report released last month by the Long Island Power Authority, as energy demand in the region declines.

Though repowering the plant — replacing steam turbines with newer equipment at its current site — would increase efficiency and environmental friendliness, it would cost more than $1.1 billion in its first 10 years of service — an average additional cost of $536 for each residential LIPA customer, the three-year study by PSEG Long Island stated. Similar studies released last month showed that it would not be feasible to repower the station in Port Jefferson or to move forward with Caithness II, a proposed $2.9 billion plant in Yaphank.

An independent assessment determined that the existing Barrett units are well maintained and “reliable for their age,” and though not being repowered at this time, the plant, LIPA officials assured, serves a need, and will continue to operate.

But local leaders and the Island Park school district have shown concern for the Barrett plant’s future. LIPA now pays $36 million in property taxes annually on the plant, which represents about 47 percent of the district’s tax base.

If repowered, the plant would have $29 million in property taxes per year, the study concluded. However, the $7 million decrease, according to the report, “is not adequate to remove the economic disincentive for further investing in legacy power plant sites such as the Barrett site.”

LIPA is in the middle of tax grievance proceedings filed in 2010 against Nassau County, the Town of Huntington, the Village of Port Jefferson and the Town of Brookhaven — the tax jurisdictions for its four Long Island Lighting Company legacy power plants — claiming that property taxes on these facilities are over-assessed by at least 90 percent.

Island Park’s Barrett plant, on a 127-acre property south of Daly Boulevard and west of the Barnum Island bridge, comprises two steam units primarily fueled by natural gas that began operating in 1956 and 1963, as well as 11 combustion turbines.

Barrett was awaiting LIPA’s approval of a repowering project first proposed by National Grid in December 2013. The potential overhaul of the existing facility, to be known as the Island Park Energy Center, called for a new plant with electric generators. Local leaders had pushed for the repowering over the past few years to reduce the plant’s carbon footprint.

“I will continue to argue to LIPA that repowering Barrett makes sense,” State Sen. Todd Kaminsky said in a statement after the report was released. “That is, for the next 10 years, we can either have an aging, dirty plant or — what I think is preferable — a repowered plant that is more efficient, friendlier to the marine ecosystem and resilient to storms.” 

In terms of the plant’s environmental impact, LIPA Chief Executive Officer Tom Falcone said that the Barrett plant currently operates under emissions limits and, though repowering it would lower carbon dioxide and nitrogen oxide emissions per unit, a more efficient plant would run more frequently, increasing local emissions.

Without repowering the plant, Falcone said, emissions would decrease by 77 percent by 2030. He added that LIPA is implementing speed drives and fish-friendly screens in accordance with the Federal Clean Water Act.

Kaminsky said that the power demands in southwest Nassau County would remain high, and that the plant would complement renewable-energy sources.

But according to the LIPA report, the 2017 peak load forecast for 2030 is about 1,700 megawatts less — the equivalent of three to five large base-load central station power plants — than what a previous forecast for that year, prepared in 2013, had estimated.

LIPA will have a power capacity surplus until at least 2035, due in part to increased energy efficiency and a growth in renewable energy. The state’s Clean Energy Standard, for example, designed to reduce air pollution and fight climate change, requires that 50 percent of New York’s electricity come from renewable energy sources, such as solar and wind, by 2030.

“This excess provides LIPA significant redundancy and flexibility to meet changing but currently uncertain needs,” the report stated. “New long-term commitments to generation now would reduce the flexibility to respond to changing conditions.”

Nassau County Legislator Denise Ford said she would write a letter to Gov. Andrew Cuomo for assistance.

“I’m very disappointed so far about their initial decision,” Ford said, “but I’m not giving this fight up because I firmly believe that plant needs to be upgraded. The best way to upgrade it to make it more environmentally friendly for that neighborhood would be to repower.”

Falcone explained that upgrades could still be made in the future, but that the ones proposed now do not make sense as energy needs continue to change. “Just because somebody built a plant there in 1957 doesn’t mean that that’s the best fit for 2027,” he said. “What you replace it with has to meet your needs in 2027.”

A Barrett repowering of a different scale or technology may provide similar environmental benefits at a lower cost, Falcone said, such as adding more “flexible generation” like simple-cycle units, which are options for exploration in future studies.

“We don’t put this in a drawer and forget about it for 20 years,” Falcone said of the report, adding that LIPA constantly evaluates its potential investments and consistently analyzes changes in energy demand. “Three years from now, we’re going to do it again.”