Pure Energy Infrastructure proposes gas-fired partnership with NYPA

Pure Energy Infrastructure LLC told the New York Power Authority that would it would like to form a public-private partnership with the authority to convert several gas-fired peaker plants in New York City to combined cycle mode, thus adding 305 MW of new generating capacity at those facilities.

Pure Energy Infrastructure (PEI) was one of dozens of parties that recently submitted proposals to the authority under the state’s Energy Highway initiative, which is an early-stage process to identify power generation and transmission projects for the state’s future.

The PEI proposal involves the authority’s New York City LM-6000 In-City Peakers. “PEI has formed an experienced Project Team that would work in concert to assess the repowering potential for each of NYPA’s six (6) In-City Peakers that consist of four (4) sites with 2×0 simple cycle configurations and two (2) sites with 1×0 simple cycle configurations representing a total generating capacity of approximately 490 megawatts (MW),” said the PEI proposal. “PEI believes that based on its prior experience siting, developing, permitting, financing, and constructing the 1×1 LM-6000 Bethpage III project (Long Island) that there is significant potential to repower some or all of the In-City Peakers.”

Under this proposed partnership, PEI and its equity partners would fund all the development and equity capital to assess, permit and reconfigure the feasible sites. NYPA would continue to own the base asset and PEI and its equity partners would own the incremental capacity and would negotiate an arm’s length Power Purchase Agreement with NYPA for the new incremental MWs added as a result of the repowering. Under the partnership, NYPA would continue to operate each reconfigured site and have direct and contractual ownership of all power output and related products. Two of the existing facilities are in Brooklyn, two in the Bronx and one each in Staten Island and Queens.

Advantages including 305 MW of new generating capacity

Based on PEI’s analysis, reconfiguring the In-City Peakers to combined cycle mode would produce various benefits, including:

  • NYPA does not have to use any of its ratepayer’s funds, cash, lines of credit or encumber its balance sheet to undertake this effort;
  • combined cycle operation would reduce In-City Peakers’ heat rate from ~10,100 to ~7,900 HHV (unfired) and 8,700 HHV (fired), representing a 21.8% and a 13.9% improvement in overall fuel efficiency, respectively;
  • long-term fuel cost savings for NYPA and its ratepayers, pertaining to the 490 existing base MW, would represent millions of dollars in fuel savings;
  • per kWh emission rates would be significantly reduced producing a positive environmental impact; and
  • assuming all six sites could be reconfigured, a total of 305 MW of clean, efficient in-city generation capacity would be added, eliminating the need for new generation sites.

Paul Barnett, the founder and CEO of PEI, was a co-founder of Pure Energy Resources LLC (PER) where he led the development of the Bayonne Energy Center (BEC). Prior to founding PER, Barnett was a member of Calpine Corp.’s (NYSE: CPN) Boston-based senior management team that initiated Calpine’s East Coast business operations, including the management and expansion of Calpine’s initial portfolio from 700 MW to in excess of 7,000 MW. He directly led the development effort to site and license the Osprey Project, a 660 MW CCGT facility located in Auburndale, Fla., adjacent to the Auburndale Cogen plant, the PEI proposal noted. He also developed a 50 MW peaker project and 79.9 MW CCGT project, both located at Calpine’s Bethpage, Long Island, site and under contract to the Long Island Power Authority.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.