The Sierra Club and Ratepayer and Community Intervenors, represented by Earthjustice, filed a Sept. 26 lawsuit in the New York Supreme Court challenging a New York State Public Service Commission (PSC) ruling for $150m in subsidies on New Yorkers’ electricity bills to re-fuel the Dunkirk coal plant with natural gas.
This “bailout” would result in a plant three times larger than necessary to maintain reliable operation of the region’s power grid, the Sierra Club said in a Sept. 26 statement. The plant would be allowed to burn both coal and gas, increasing unhealthy air pollution in the region and contributing to dangerous climate disruption, the club said.
Notable is that plant owner NRG Energy (NYSE: NRG) has said that coal would only be used in the unlikely event that natural gas was unavailable at any particular time, like during high winter gas demand periods. NRG is currently seeking approval for a new gas pipeline to the Dunkirk plant under its Dunkirk Gas subsidiary.
The local grid owner, National Grid, said it could make up for the retirement of Dunkirk through grid upgrades, but NRG, in a deal brokered by New York Gov. Andrew Cuomo, was presumptively able to save the plant and its local jobs through the re-fueling project.
“It’s not fair to make our families pay for more dirty fuels when there are better solutions available. Governor Cuomo should be helping communities and workers in the transition away from coal, not allowing companies to continue burning coal indefinitely at the expense of our families’ health,” said Lisa Dix, Senior New York Representative for the Beyond Coal Campaign.
Ratepayer advocates are concerned that the decision could start a cascade of similarly expensive proposals from the other coal plants in the state facing their own economic problems, the club said. There almost no coal plants left in New York, by the way. The Danskammer plant, shut since 2012 and being brought back into operation, can no longer use coal under revised permits and other approvals.
“We can’t afford more dangerous fossil fuel pollution or the higher bills that come with it. We need Governor Cuomo to support our communities and workers in a responsible transition away from coal and gas and toward truly renewable energy sources,” said Carol Chock, Legislator from Tompkins County and President of Ratepayer and Community Intervenors.
NRG had requested authorization to mothball the uneconomical facility in 2012. However, the local utility identified a reliability need for one unit of the plant, so it was granted a temporary Reliability Support Services Agreement (RSSA), a ratepayer-funded subsidy for continued operation of that unit through June 1, 2015.
As the expiration neared, Cuomo pushed the PSC to approve additional ratepayer subsidies to reopen the other three units and allow them to burn both coal and gas. This was after National Grid had already shown that a grid fix would solve the reliability issue. The PSC, under direction from the governor, accepted the expensive, oversized plan, the club said.
“The PSC is supposed to protect consumers, not blindly follow Governor Cuomo’s misguided attempt to subsidize the profits of out-of-state energy companies,” said Shannon Fisk, lead counsel for Earthjustice on this case. “It’s not right to make New York’s families pay for continued dangerous pollution in their communities.”
This high court challenge is the latest action in more than a year of opposition from groups including the New York Business Council and Independent Power Producers of New York.