Reliability issues raised over pending mothballing of Cayuga coal units

The New York Public Service Commission said Sept. 28 that due to concerns about grid reliability raised by two parties, it will take public comment on a plan by Cayuga Operating Co. LLC to mothball two coal-fired units at the Cayuga power plant.

On July 20, Cayuga Operating filed a notice with the commission stating that it intends to mothball the two units, located in Lansing, N.Y., no later than Jan. 16, 2013. In letters from Iberdrola USA Management Corp. and the New York Independent System Operator (NYISO), dated Aug. 24, those parties said the proposed mothballing would raise issues affecting the reliability of electric service, the commission noted.

“The Commission is considering remedies to ensure continued reliability, including the adoption of any rates, terms, or conditions necessary to preserve adequate reliability,” the commission added. “This notice is to advise the parties that they are directed to file either an agreement, or proposed terms recommended by each party, along with justifications and complete supporting documentation, for consideration by the Commission, by no later than October 29, 2012.” 

In its Aug. 24 letter to the commission, Iberdrola USA noted that the PSC had requested that the NYISO and Iberdrola affiliate New York State Electric & Gas (NYSEG) work together on an analysis of the effects on electric system reliability and local reliability issues related to the intent to mothball Units 1 and 2 (about 150 MW each) at Cayuga and to propose solutions in the event the retirement adversely affects reliability. NYSEG then completed local planning studies with both of the subject units out of service.

NYSEG identified various impacts, including a thermal overload of the 336 ACSR conductor in the Elbridge-to-State Street 115-kV line #972 under all facilities in-service system conditions at a local area load level of 135 MW which is about 73% of the projected 2012 summer peak load. Exposure to this condition historically has been limited to the months of June through September for a total of 221 hours in 2011.

NYSEG pursues transmission reinforcement work

In anticipation of a cold standby of both Cayuga units and these potential impacts, NYSEG has proposed a transmission reinforcement to the Auburn area. The reinforcement currently includes a new 14.5-mile, 115-kV line from National Grid’s Elbridge Substation to NYSEG’s State Street Substation. In addition, in the event that Cayuga is going to be permanently retired, NYSEG is also proposing to rebuild the existing 14.5-mile, 115-kV line #972 from National Grid’s Elbridge Substation to NYSEG’s State Street Substation with 1033 ACSR conductor.

This plan will eliminate the thermal overload problems in the Auburn area and will satisfy capacity and voltage requirements by creating a new transmission supply into the Auburn Division. This will enable NYSEG to provide adequate and reliable electric service to all customers in the Auburn Division during either extended outages (planned or forced) of the Cayuga units (Phase 1) or in the event that one or both units are permanently retired from service (Phase 2).

NYSEG is pursuing the first phase of this project and is intending to file an Article VII application with the commission around the end of 2012. The proposed in-service date is currently the end of 2016 for Phase 1.

Studies completed to date by NYSEG and the NYISO identify that in the interim, both units at Cayuga will need to be available and capable of being committed when NYSEG and the NYISO determine it is required for system reliability. Based on the preliminary study results from NYSEG and the NYISO, a coordinated study with NYSEG, NYISO, and National Grid is needed to further analyze other local transmission facilities outside of the Auburn area. This coordinated analysis will identify any additional potential reinforcements required to mitigate possible reliability issues on the bulk and non-bulk transmission system.

Initial discussions with the NYISO conclude that the coordinated study and potential long-term solutions for the wider study area could be completed by the end of January 2013, Iberdrola noted. NYSEG has provided these findings to the NYISO and it understands that the NYISO will take the appropriate steps to model and study the Cayuga mothballing in the next Installed Reserve Margin Study and through the Comprehensive Planning Process to assess if there are likely to be impacts on the New York bulk power system.

Finding no market power issues, the New York commission on June 29 had approved the transfer of control of the coal-fired Cayuga and Somerset power plants to financial entities including affiliates of J.P. Morgan. These plants had been controlled by bankrupt affiliates of AES Corp. (NYSE: AES), with the plants sold earlier this year to creditors of the bankrupt companies. Parent AES Corp. is not itself in bankruptcy, just affiliates that include AES Eastern Energy LP.

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.