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NYPA: Our History (Cont'd)

Diverse Generating Mix

In response to increasing oil prices in the 1970s, the Power Authority looked to Canada for abundant and inexpensive electricity supplies. The Power Authority completed a new transmission line, at 765 kilovolts (kv) the most powerful in the state, in 1978. The line begins at the Canadian border, near Massena, and extends 155 miles to Marcy, near Utica, home of the Power Authority’s statewide Energy Control Center. Also in the late 1970s, the Power Authority began a program to develop small hydroelectric facilities around the state. Five plants, with a combined capacity of 29,596 kw, are now in operation. In the 1980s, the Power Authority undertook other transmission projects, notably the 345-kv Marcy-South line, which stretches 207 miles from Marcy to Dutchess County, and the 345-kv underground/underwater Sound Cable, bringing economical electricity to Long Island.

The Power Authority again demonstrated its ability to provide lower-cost energy in 1991 by winning the right to build the state’s first competitively bid power plant, in Holtsville, Suffolk County. The 135,600-kw Richard M. Flynn Power Plant, named for the Power Authority’s chairman at the time, burns natural gas as its primary fuel, with low-sulfur oil as a backup. It began operation in 1994.

New emphasis on infrastructure

As the electric utility industry moved away from monopolies and toward competition, the Power Authority helped to facilitate the transition in cooperation with New York State's investor-owned utilities. In November 2000, the Power Authority sold its Indian Point 3 and James A. FitzPatrick nuclear plants to Entergy Corporation for a record $967 million. The sale represented the highest purchase price of a nuclear asset in the history of the nuclear power industry and was the largest privatization of New York State assets.  Entergy's advantages in terms of economies of scale and its ability to pool resources and expertise were expected to facilitate the state's move to a competitive electricity market, with lower prices for residents and businesses.

To help ease energy demand and costs downstate, NYPA was authorized to install small natural gas-powered generating plants at six sites in New York City and one on Long Island, a fast-track assignment completed in the summer of 2001.  The total combined production of these clean, efficient facilities is about 460 megawatts (MW), equivalent to the capacity of one medium-sized power plant. In 2005, the Power Authority’s newest and cleanest generator, a 500-MW "combined cycle" power plant, began producing electricity on the site of NYPA’s Charles Poletti facility, paving the way for cessation of operations at the original Poletti plant on January 31, 2010.

As the 20th century was drawing to a close, the Power Authority refocused its attention on its large hydropower projects, ensuring that reliable supplies of this low-cost power would be preserved for many years to come. Preparations began for the complex task of renewing the original 50-year federal licenses for both the St. Lawrence-FDR and the Niagara projects, due to expire in 2003 and 2007, respectively. In parallel, NYPA also moved ahead with a multi-year programs to upgrade and modernize the generating units at both Niagara and St. Lawrence-FDR.

Past experience by other utilities proved that traditional relicensing processes were arduous long-term assignments, entailing a maze of energy-related, regulatory, political, environmental, financial and community issues, all endlessly intertwined and generating mountains of paperwork. The Power Authority chose an alternative path, employing innovative procedures that provided for full participation by all interested parties from the onset, with the goal of making them partners in decision-making. The end result would reduce or eliminate unresolved issues and win broad support before the license applications were submitted to the Federal Energy Regulatory Commission (FERC).

NYPA officially began the relicensing for the St. Lawrence-FDR project, its first generating facility, in 1996, after a lengthy consultation phase. FERC approved a new 50-year license on October 22, 2003, less than two years after the Power Authority had filed its application and more than a week before the previous license was set to expire. Noting that relicensings at smaller hydro projects around the nation had taken years longer, FERC pointed to the success of NYPA’s innovative process, which reflected “the value of intense collaboration among interested parties.”

The formal relicensing of the Niagara project began in late 2002 following a similarly alternative process, culminating in federal approval of a new 50-year license on March 15, 2007, more than five months before the facility’s original license was set to expire on August 31. The relicensing of both hydropower projects resulted in a variety of benefits for the regions where they are located, including environmental enhancements, recreational improvements, new dedicated power allocations for economic development and monetary payments to host communities for specific municipal purposes.

At the same time, NYPA continued its role as steward of New York’s largest hydropower resources by investing in several multi-million dollar refurbishments. A $15-year, $300 million upgrade at the Niagara project’s main power dam, known as the Robert Moses Niagara Power Plant, was completed in 2006; preliminary work on a $460 million improvement project at the site’s auxiliary generating facility, the Lewiston Pump-Generating Plant, began in 2012, with work to proceed over the next nine years. At St. Lawrence-FDR, a $281 million Life Extension and Modernization (LEM), also scheduled over 15 years, is on track for completion by early 2013. Meanwhile, a $135 million LEM at the Blenheim-Gilboa Pumped Storage Power Project was successfully completed within the allotted four-year time frame.