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Low-Cost Hydropower to Help Spur Planned Capital Investment by Western New York Pet Food Manufacturer

Contact:
Michael Saltzman
914 390-8181
Michael.Saltzman@nypa.gov

July 28, 2009

FOR IMMEDIATE RELEASE  

WHITE PLAINS—New York Power Authority (NYPA) President and Chief Executive Officer Richard M. Kessel today announced an allocation of low-cost hydropower for Nestle Purina PetCare in the Town of Dunkirk to help advance a planned multimillion dollar capital investment by the company for a proposed new product line and the creation of more than a dozen new jobs.                  

The NYPA Trustees, on June 30, approved an allocation of 1,000 kilowatts (kw) from the Power Authority’s Niagara Power Project to help spur the expansion by the pet food manufacturer, one of the major employers in Chautauqua County. The Dunkirk facility currently employs more than 300 people and spends millions of dollars a year in New York State for grains, packaging, freight and other products and services.   

“The allocation of low-cost hydropower to Nestle Purina is another opportunity for us to support the company’s continuing investment in its Dunkirk facility, which has been a vital employer for Chautauqua County since the early 1970s,” Kessel said. “Previous hydro allocations by NYPA have yielded great success in spurring the competitiveness and expansion of this facility, and we’re anticipating similar results from the latest allocation. It’s another example of the progress that we’re making under Governor Paterson for maximizing the economic development value of the available hydropower from the Niagara project.”    

Kessel noted that Nestle Purina, which currently receives 3,400 kw of hydropower, has increased its Dunkirk employment by 25 percent over nearly two decades, due, in part, to significant savings from its allocations of Niagara power.   

Nestle Purina is planning to enlarge its building, to accommodate the proposed new product line, which requires investment in new processing equipment and other advanced technologies.  The facility already produces numerous dog and cat food products.   

“The new allocation of low-cost Niagara hydropower is a significant development for Nestle Purina’s moving forward with the proposed expansion in Dunkirk,” said Ronald E. Bowers, the plant manager at the Dunkirk facility. “We’re excited about these plans since they further solidify the importance of our facility to the company, which has 60 pet food manufacturing facilities around the world.  We’re looking forward to proceeding with the expansion and are grateful to the Power Authority for its crucial support, and to state and local economic development agencies.”   

Over the years, Empire State Development (ESD) and the Chautauqua County Industrial Development Agency (CCIDA) have worked with Nestle Purina on tax incentives and other measures for encouraging the expansion of the Dunkirk plant.

“Nestle Purina is a highly regarded enterprise that has provided stable employment for Chautauqua County for many years,” said Dennis Mullen, president and chief executive officer of ESD, New York’s lead economic development agency.  “We recognize the importance of this company—the only major pet food manufacturer in the state—and are excited about the possibility of its undertaking additional major capital investments in Dunkirk.”

“We’ve been very successful helping local manufacturers retain jobs in Chautauqua County by working with local and state governments,” said Bill Daly, administrative director and chief executive officer of the CCIDA. “We’re glad for the opportunity to support Nestle Purina’s expansion plans, and thank the Power Authority for backing this initiative with the latest low-cost hydropower allocation.” 

Both the current and additional amounts of hydropower for the company are from a block of power called Expansion Power, one of two large amounts of Niagara power that directly support tens of thousands of jobs on the Niagara Frontier, under state law.  (The other block of power is known as Replacement Power.  Together, the two amounts account for about one-third of Niagara’s firm generating output.)   

Niagara power is provided to Western New York businesses at rates typically 75 percent less than the average wholesale market prices in the state, making it a vital instrument of economic development. In Chautauqua County, a total of nine businesses, including Nestle Purina, currently benefit from allocations from the hydroelectric project, with the power helping to support approximately 3,100 jobs at those firms.  

The latest allocation to Nestle Purina was supported by the Western New York Advisory Group (WNAG), consisting of the NYPA, National Grid, ESD, the Buffalo Niagara Enterprise, the Erie County Industrial Development Agency, and the Niagara County Center for Economic Development. The WNAG helps identify qualified companies for available industrial power from the Niagara project.  

 About NYPA:

■    The New York Power Authority uses no tax money or state credit.  It finances its operations through the sale of bonds and revenues earned in large part through sales of electricity.  ■    NYPA is a leader in promoting energy efficiency, new energy technologies and electric transportation initiatives.  ■    It is the nation's largest state-owned electric utility, with 18 generating facilities in various parts of New York State and more than 1,400 circuit-miles of transmission lines.  ■    About 75 percent of the electricity it produces is clean renewable hydropower.  Its lower-cost power production and electricity purchases support hundreds of thousands of jobs throughout the state.  ■    For more information, www.nypa.gov

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