By Bryan Wroten
NRG Energy Inc. intends to add natural gas and run the Avon Lake power plant as a peaking power plant, according to a company spokesman.
Though it is not a conversion to natural gas, said David Gaier, spokesman for the NRG East Region, the plan is to add natural gas as the main fuel source at the plant.
“We’re not losing the coal capability, but the intention is to work on natural gas,” he said, adding it is a cleaner-burning fuel.
GenOn Energy, the previous owner of the plant, announced in February 2012 it scheduled to close the plant in April 2015, citing an insufficient return on investment to comply with environmental regulations. The Avon Lake plant was one of many GenOn planned to close.
The gas-added project is at the beginning stages right now, Gaier said, and will need to go through several permitting, engineering and construction steps. The plant will also need an extension from the Ohio Environmental Protection Agency to continue running on coal for a year, he said.
“I do want to stress we are at the beginning stage of the process,” he said. “A lot of things need to happen between now and then.”
NRG will have to perform detailed engineering studies, confirm its capital expense requirements, apply for and receive permits and then reach the construction stage, he said, adding that construction would be for both the plan and the pipeline to bring in the natural gas. He could not share any details of the pipeline at this time.
Should everything go according to plan, he said, the gas-added project should be complete by May 2016. The plant would become what is known as a peaker plant, he said, which is a power plant that operates on the hot days of summer when there is peak electricity usage because more people are using air conditioning. The plant currently employs about 75 full-time workers, he said, but that number would likely be reduced to about 35 to 40 full-time employees after the project is complete.
“We look forward to working with the town elected officials, state and local regulators and state and local municipal officials to accomplish what we need to do to move the project forward and be successful,” Gaier said.
Up until the announcement, both the city government and school district had been trying to prepare for the scheduled April 2015 closing. City Council placed a request for proposal (RFP) for approval in order to find expert firms to help the community handle a closed power plant. The city was also beginning to set up a commission that would include city, school and Avon Lake Municipal Utility officials as well as residents and local business owners.
Mayor Greg Zilka said he had been working with Congresswoman Marcy Kaptur’s office on how to handle the power plant closing when he learned that NRG was reassessing the situation and that natural gas would be a possibility. The city had been waiting since a May energy auction to find out what could happen in Avon Lake.
“It’s good news for the city and the school district,” he said. “We’re hoping everything plays out the way they are anticipating and we have a more stable future of Avon Lake as a city and for Avon Lake City Schools.”
Councilman at Large and Economic Development Committee Chairman Dan Bucci said his initial thought is to go forward with the RFP and create the commission, to which the mayor agrees. The RFP is nonbinding, he said, and if the city ends up not needing any company’s services, it can back out. As for the commission, he said, it wouldn’t hurt to have all of those people working together regardless.
“If you have an opportunity to get everyone together, you should do it,” he said.
The possibility of adding natural gas to the plant and keeping it open came as welcome news to Superintendent Bob Scott. The school district would have lost heavily from the plant’s closure, as the district depends more on the property taxes and electricity generation taxes than the city. Though there’s no way of knowing how this will affect the district financially, he said even a reduction in generation, and therefore a reduction in tax revenue, would still be better than none at all.
“Just the fact that (NRG is) going to keep it open, turn it into a gas plant for the long term, is financially a great thing for the school system,” he said.
One of the issues to work out locally is the property tax issue, he said. While the district typically doesn’t have a say in any local abatements, the city does include the schools in the discussion. The district wouldn’t want to be a barrier to the long-term health of the city, he said.
There are still a lot of big ifs, he said, including the pipeline, so the district will participate in the city’s advisory commission.
Should the plans go through, Scott said, it would fall in line with the district’s planned renewal of two levies, one in five years and another five years after that. It’s entirely possible, he said, that the district could keep the two as straight renewals or, hypothetically, even reduce one or two levies depending on the district’s financial health as a result of the plant staying open.
“Even being able to think in that direction is tremendous,” he said.
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