TC Ravenswood works out deal on fuel oil for back-up needs

TC Ravenswood LLC, the New York Independent System Operator, Consolidated Edison Co. of New York, the City of New York, the New York Power Authority and the New York State Public Service Commission on Dec. 19 filed at the Federal Energy Regulatory Commission a settlement over oil use at TC Ravenswood’s power plant.

The deal fully resolves issues related to the compensation and terms and conditions under which TC Ravenswood will generate electric energy using 0.3% sulfur High Pour (HP) No. 6 Fuel Oil in lieu of natural gas in furtherance of the New York State Reliability Council’s Local Reliability Rule I-R3 (called “Loss of Generator Gas Supply-New York City”) during a three-year period beginning May 1, 2014, and ending April 30, 2017. Payments made by the NYISO for commodity, emissions and fuel oil taxes, as applicable, will be in accordance with its Market Administration and Control Area Services Tariff.

During the term of this deal, in return for certain payments, in response to requests from NYISO and/or Con Edison, TC Ravenswood will burn Fuel Oil for certain needs, unless it would cause steam generating units 10, 20 or 30 to be considered “oil-fired electric utility steam generating units” as defined under the U.S. Environmental Protection Agency’s Mercury and Air Toxics Standards (MATS) or cause a violation of MATS.

In the event TC Ravenswood forecasts that one or more of its units is likely to be considered at a future date to be “oil-fired electric utility steam generating units” as defined under MATS, TC Ravenswood will make a good faith effort to obtain a waiver from EPA from MATS compliance obligations for the applicable unit(s). However, this deal does not require TC Ravenswood to invest in any improvements, changes or upgrades to its units to reduce emissions and enable it to operate as a “oil-fired electric utility steam generating unit” as defined under MATS, and TC Ravenswood is not seeking compensation in this settlement in order to make such improvements, changes or upgrades.

In order to efficiently provide fuel oil burn and satisfy its procurement, storage, handling, and delivery obligations for all fuel oil use at the Ravenswood site during the period of May 2014 through April 2017, TC Ravenswood and TC Ravenswood Services Corp. will co-mingle the use of their fuel oil storage and delivery facilities as well as Operation and Maintenance activities and administrative services with the use of other fuel oil customers served from the Ravenswood site.

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.