pLYONSDALE — Citing record-low wholesale electricity prices, ReEnergy Holdings has placed its wood-chip cogeneration plant here in standby mode./ppHowever, company officials said they could resume full operations if fiscal conditions improve and will avoid layoffs of the 22 employees at the Marmon Road facility for the time being, thanks to a state Department of Labor program. “It became clear that the most prudent course was to place the facility into a standby mode,” company CEO Larry D. Richardson said in a statement. “We will continue to seek solutions that would allow the facility to be financially viable and to continue to serve as an end-market for forest residue and mill waste.”/ppThe 22-megawatt facility continues to accept chips from some suppliers, but deliveries “have been curtailed significantly,” according to a release. It could restart if requested by the New York Independent System Operator, the state’s electricity grid operator, or if electricity prices recover due to peak demand in July and August and again in late fall and winter, the release states./ppReEnergy Lyonsdale employees were notified of the situation Monday and will meet later this week with a Department of Labor representative concerning its shared work program, which will allow 21 of them to work 16 hours per week while collecting partial unemployment insurance benefits, company officials said. The plant manager will remain full time, and the company will continue to offer employee benefits./ppThe shared work program can be utilized for up to 53 weeks, but it is unknown how long the Lyonsdale plant will remain in standby mode and make use of the program, the release states./ppMr. Richardson in February announced the plant could close in 60 to 90 days, stating that wholesale energy prices had dropped by about 40 percent over the past year and the Lyonsdale operation lost more than $1 million in 2015./ppThe facility in March decreased the price paid to loggers as a stop-gap measure. However, attempts by the company to seek new energy contracts as well as state Public Service Commission approval to sell additional renewable energy credits to the New York State Energy Research and Development Authority — a proposal endorsed by U.S. Sen. Charles C. Schumer, D.-N.Y. — have not panned out./pp“We have been unable to secure an energy sales agreement or bridge funding to allow for the facility to be financially viable under current market conditions,” Sarah M. Boggess, ReEnergy’s director of communications and government affairs, said by email. “The New York State Public Service Commission is currently formulating the state’s future renewable energy policy in the form of the Clean Energy Standard, and the facility could perhaps be viable once that policy is in place, if there is a mechanism for the facility to sell renewable energy credits at a sufficient price.”/ppGov. Andrew M. Cuomo has called on the PSC to develop a standard to mandate that 50 percent of all electricity consumed in the state by 2030 come from renewable energy sources./ppLewis County Manager Elizabeth Swearingin said she was happy that ReEnergy decided not to close the plant immediately and has worked with the community and state to “lower the burden on the employees.”/pp“I think everybody is just hoping this isn’t a kicking-the-can-down-the-road thing,” she said./pp“I look it as good news,” said Legislator Roscoe K. “Rocky” Fawcett Jr., R-Lyonsdale./ppIf the facility was shutdown completely, the need for rehiring and training employees would make reopening much more difficult and unlikely, he said./ppReEnergy’s facility at Fort Drum, ReEnergy Black River, is unaffected by Lyonsdale’s status change./pp“Although the Black River facility has been experiencing financial challenges, its financial position is not as dire because a meaningful portion of its output is being sold to Fort Drum under the terms of a 20-year renewable energy sales agreement,” the release states./ppReEnergy said its Lyonsdale plant has supported loggers by spending about $6 million annually on 240,000 tons of wood chips from about 25 logging contractors. It also utilizes shrub willow grown on local marginal farmland through a program funded by the U.S. Department of Agriculture in collaboration with SUNY College of Environmental Science and Forestry, Syracuse./p
↧