Executive Speeches

Excerpts from remarks of Roger B. Kelley, president and chief executive officer of the New York Power Authority, at the Hartland Volunteer Fire Company’s Installation Dinner, Hartland, New York.

January 19, 2008

I am honored to be with you tonight for your Installation Dinner and to express my thanks and admiration for your courage and commitment to your community.

This event also has special meaning to me because I spent about 10 years of my career focused on the financing, development, construction and operation of the nearby Lockport Cogeneration Facility. 

As members of the Hartland Volunteer Fire Company, you are building on a proud tradition of volunteer firefighting that dates to the Colonial period of America’s history and continues today in communities throughout the nation.

Here in New York, this year marks the 10th anniversary of the dedication of the Fallen Firefighters Memorial Wall on the Empire State Plaza in Albany.  That wall bears the names of more than 23 hundred New York firefighters—many of them members of volunteer companies—who have given their lives in the line of duty.

Last fall, 12 new names were engraved on the wall.  Governor Spitzer presided at the ceremony and paid tribute to the bravery and sacrifice of all firefighters and their families.

Firefighters, said the governor, “overcome every natural human instinct for self-interest and self-preservation so they might save the lives of others.  I do not believe there can be a better definition of heroism than that.”

Tonight, I echo those sentiments.

At the New York Power Authority, we have a particular need—and appreciation—for the professionalism and dedication of volunteer firefighters and other “first responders” in various parts of the state.

The Power Authority is the nation’s largest state-owned electric utility.  We own and operate 18 power plants—including the massive Niagara Power Project in Lewiston—and about 14 hundred circuit-miles of transmission lines.  So we rely heavily on the emergency services in our project areas—both to respond to actual events and situations and to cooperate with us in drills, planning and related activities.

Given the Authority’s role as a major power provider, I was asked to talk to you tonight about current energy issues.  But, I was told, “Remember, this is a Saturday night dinner—so keep it light and entertaining.”

Well, let’s see.  We have one-hundred-dollar-a-barrel oil.  Three-dollar-a-gallon gasoline.  Dire predictions about global warming.  And I was told to keep it light. 

The fact is, that New York State—like the nation—faces some of the most imposing energy challenges in its history.  Our responses will affect national security, the environment, the strength of our economy and our overall quality of life.  So what I have to say won’t be light, but I hope it will be relevant. 

I want to focus tonight on the electricity part of the energy business.  More specifically, I want to tell you about what the Power Authority is doing to help make sure the state has a reliable, clean and economical power supply.  Then I’ll touch on some of our activities here in Niagara County.

An organization called the Independent System Operator is responsible for overseeing New York State’s electric transmission network, administering its wholesale power supply markets and carrying out a comprehensive planning and forecasting process.

The ISO reported recently that new generation or transmission will be required as soon as 2012 to ensure reliable service—particularly downstate.  Statewide, it said the equivalent of 2,750 megawatts of new resources will be needed by 2017. 

To put that number in perspective, the Niagara Project—which is New York’s largest power producer and one of the nation’s largest—can dependably produce just over 2,400 megawatts, or enough electricity to meet the needs of nearly 2 million homes.  Each of you, by the way, receives a share of its low-cost hydroelectric power through your local utility.

The Power Authority has a long history of building major power plants and transmission lines in response to critical needs.  What we did at Niagara just about 50 years ago—after a rockslide destroyed Niagara Mohawk’s Schoellkopf plant and created a severe power shortage—is a classic example of that.

Today, the Authority views the private sector as the primary provider of new generation and transmission.  But we cannot—and will not—rule out the possibility of building new facilities of our own if the needs are not being met by others.

As of now, the new power plants and transmission lines that New York will need to meet its future requirements have not been built.  And—given the difficulties of siting, licensing and constructing a new facility—we’re starting to run out of time.

New resources will be required to keep the lights on.  By encouraging competition in our industry, they’ll help to lower costs to electricity consumers—something I know is important to all of you.  And they’ll benefit the environment by permitting the retirement of older, less-efficient power plants.

We must also meet these goals by doing all we can to promote energy efficiency.  In fact, by using the energy we have more wisely, we can reduce the need to build new power plants and transmission lines.

Governor Spitzer has proposed an ambitious “15 by 15” plan to cut the state’s electricity use by 15 percent below forecasted levels by 2015.  The Power Authority intends to play a big part in this program, which will be the most aggressive of its kind in the nation.

We’ve already invested more than a billion dollars in completed energy efficiency and clean-energy projects at close to 2,650 public facilities throughout the state—including more than 20 buildings and other sites operated by the Niagara County government.  Now we’re looking to expand our efforts by investing a total of $1.4 billion in new initiatives between now and 2015.

We’ll also have a vital role in two other programs that will help to protect the environment and reduce our dependence on foreign oil.

One is the Regional Greenhouse Gas Initiative—in which New York and nine other Northeastern and mid-Atlantic states will cap and then progressively reduce the emissions of greenhouse gases from their power plants. 

The other is the Renewable Portfolio Standard, which requires that at least 25 percent of the electricity sold to New York’s retail consumers by 2013 come from clean, renewable sources.

The state’s now at about 19 percent—thanks mainly to the Power Authority’s Niagara project and our large hydroelectric facility on the St. Lawrence River.  Looking ahead, the Authority will be working to build on our record in advancing fuel cells, solar power, wind and other renewable resources.

As for the Niagara Project, we’ve been going through an eventful period, to say the least.

Last year we received a new 50-year federal license for Niagara—which took effect on September 1.  Some months before that major milestone, we’d completed a 15-year, $298 million upgrade at the project’s main generating facility—the Robert Moses Niagara Power Plant. 

Taken together, the new license and the upgrade mean we’ll be operating this great hydro project for many years to come—and will be doing so at maximum efficiency.  That’s a very promising combination for the Niagara Frontier.

In line with the relicensing, we reached agreements with various entities—mostly in the immediate project area.  But the people over in this part of the county will share in some of the benefits of those settlements.

The Power Authority will, for example, provide $9 million a year throughout the 50-year license term for development of a Niagara River Greenway from Lake Erie to Lake Ontario.  That’s not exactly in your backyard, but I hope you and your neighbors will be able to enjoy the Greenway, which should provide an economic boost to the entire region.

Also as part of the relicensing, the Niagara County government will receive at least $650,000 a year from the Authority over the license term, as well as a nine-megawatt allocation of Niagara power.

The money will be used for capital projects, public health and safety and other purposes in all parts of the county.  The power will provide taxpayer savings on the electric bills at county facilities.  And it will also be available for new businesses—with new jobs—that locate here.

Niagara hydropower is one of the best things we have going for us as we work to strengthen the Western New York economy.  More than 36 percent of the project’s firm—or guaranteed— output is designated for use by companies that promise to create jobs and invest in the area in return for their allocations.

More than 44,000 jobs at about 130 companies in the region depend on this power—some of the least-expensive in the nation for businesses. And a number of those companies—I’m happy to note—are right next door in Lockport.

We now have about 60 megawatts available for allocation to Niagara Frontier businesses.  And we’re working diligently with the Governor and various state and local entities to make certain we use it to the best possible advantage.

Let me also tell you quickly about one other promising initiative.  We’re moving ahead on a $21 million program to use Niagara hydropower to create hydrogen through the electrolysis of water in an emission-free process.  The hydrogen will then be used to fuel vehicles at a State Parks facility in Niagara Falls and a Niagara Frontier Transportation Authority site in Erie County. 

Projects like this typify the Power Authority’s varied efforts to cut reliance on imported oil, clean the air, demonstrate new technologies and take on the other challenges I mentioned earlier.

Like you, we are committed to public service.  Unlike you, we do not stand ready to routinely risk our safety and even our lives as we perform that service.

What you do—in other words—is truly exceptional.  Again, my thanks to you—and to your families.