Can City Ward Off Power Crisis?

By Bobby Cuza
Staff Writer

July 23, 2002

A string of power failures last week, capped by Saturday’s outage in lower Manhattan, has made a hot topic of how to ward off impending power crisis.

Mayor Michael Bloomberg on Monday pointed up the city’s need both to build new plants and to upgrade its transmission and distribution system, and will soon release his comprehensive energy plan, according to a spokesman.

But as Council Speaker Gifford Miller pointed out in unveiling his own energy efficiency program Tuesday, the city has little control over the power grid.

Companies planning power plants in western Queens have learned the biggest roadblock to building new generating facilities is finding investors in a post-Enron, bear-market economy.

“It’s not really a good time in the industry to be borrowing a million dollars to build a power plant,” said Liam Baker, asset manager at Reliant Energy, which has had to push back a major expansion of its Astoria Generating Facility.

The project, which would have added about 600 megawatts to the city’s power grid, was originally slated for completion in 2003 or 2004.

Now, company officials are projecting a 2007 in-service date.

Meanwhile, SCS Energy has yet to break ground on a planned 1,000-megawatt plant in Astoria that was supposed to begin construction in the spring.

“It’s a difficult market right now,” said project development director Kathleen Hathaway. “The banks are requiring different things of projects than they were, say, pre-Enron.”

Nonetheless, groundbreaking is expected this year, with completion in early 2005, Hathaway said.

None of the three other projects on the horizon — expansions of Con Ed’s East River plant, KeySpan’s Ravenswood plant and the New York Power Authority’s Poletti plant in Astoria — will be online before 2004.

And New York’s Independent System Operator, which administers the state’s electricity markets, has projected a shortfall of 2,000 to 3,000 megawatts by 2005.

Last week’s outages were the result not of a supply problem but of failures in Con Edison’s transmission and distribution system, which prompted both Bloomberg and Miller to call for improvements.

Few outages were reported Tuesday despite muggy weather that pushed usage in Con Ed’s service area to 12,059 megawatts, the second-highest demand of the year.

Miller said the city can do more to promote conservation by curbing its own energy use.

The speaker has introduced a bill requiring the city to purchase products with an Energy Star energy-efficiency label.

Bloomberg opposes the bill, which a spokesman called “unduly burdensome to the procurement process.”

Miller’s energy plan also calls for a tax-free month on all Energy Star purchases, a new division in the city’s Department of Environmental Protection to help reduce energy use by 25 to 30 percent and a more simplified building code to accommodate new energy-efficient technologies.

Copyright © 2002, Newsday, Inc.

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