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9:30 am
Wed January 29, 2014

Report paints bleak picture for Tonawanda power plant

A new report suggests the coal-fired Huntley power plant in the Town of Tonawanda is no longer appears to be financially viable and is likely "headed for retirement."

Industrial sites in Tonawanda, NY.
Credit WBFO News file photo

The River Road generating station, owned by NRG Energy, began operating in 1942. Four of its six operating units have been shut down in the past decade. Its two remaining units are both more than 50 years old. 

The report by the Institute for Energy Economic and Financial Analysis finds the plant to be in a weak fiscal position, having lost money in three of the last five years. Cathy Kunkel, who co-authored the report, says revenues have been driven down by the lower cost of natural gas, stagnant power demand, and rising coal costs.

"Projections of future New York electricity market prices and coal prices do not indicate any relief from these trends and we do not expect the Huntley plant to regain its pre-2008 level of earnings through at least 2020. Thus, the Huntley plant does not appear to be financially viable through 2020 and is at risk for retirement," Kunkel said on a conference call with reporters Tuesday.

Huntley has gone from earning $110 million in 2008 to losing $3 million in 2012. Kunkel says the plant's situation not dissimilar to what other coal plants are experiencing across the country.

The Huntley report was commissioned by the Clean Air Coalition of Western New York.  The group says neighborhoods surrounding the plant have been found to have elevated levels of hazardous air pollution.

Huntley, which is owned by NRG Energy, employs roughly 70 people and generates millions of dollars in tax revenue for the town and its school district. The report's authors say the community should begin to prepare for a post-coal era and the loss of revenue to the town and the Ken-Ton school district. 

Report co-author Tom Sanzillo says Tonawanda and its stakeholders should begin preparing for changes.

"The key to a successful outcome here is community and corporate leaders cooperating to address the challenge of what we refer to is a post-coal plant era. The more troubling scenario would be if NRG simply announced the plant closing and offered very little concern for employees and the community," Sanzillo said.

Other possibilities, the authors say, is the plant's possible acquisition by the New York Power Authority or conversion to a natural gas facility, as is planned for a power plant in Dunkirk. 

The Clean Air Coalition says it wants NRG to engage in further dialogue with the community on the plant to protect workers' jobs, preserve the environment, and maintain revenue for the region.