A Gas- fired Electric Genera1ng Plant for Vernon?

Transcription

1 A Gas- fired Electric Genera1ng Plant for Vernon?

2 Big picture background: New England s Power Grid VT buys 84% of its power from out of state and Canada. (VELCO es1mate) VY shutdown = loss of 55% of VT genera1ng capacity VY previously supplied 33% of VT electric supply

3 New England s Power Grid (2) NE is losing over 4000 megawaus of genera1on in recent or coming years: Brayton Point Sta1on 1,535 MW 4 units (coal and oil) Salem Harbor Sta1on 749 MW 4 units (coal and oil) Vermont Yankee Sta1on 620 MW 1 unit (nuclear) Norwalk Harbor Sta1on 342 MW 3 units (oil) Mt. Tom Sta1on 143 MW 1 unit (coal) Pilgrim Nuclear Sta1on 690 MW 1 unit (nuclear) Another 4500 MW of capacity is considered at risk (ICF Interna1onal)

4 New England s Power Grid (3) As a result, expect: Significant increases in the wholesale cost of electricity Unprecedented levels of electric pricing vola1lity Periodic challenges to regional and VT grid reliability

5 Background: Kinder Morgan s Northeast Energy Direct Pipeline Planned $3.3 billion pipeline from Pennsylvania to Dracut Mass. to expand the NE supply of natural gas and electric genera1ng capacity Route runs through Western MA, up through Northfield, into Winchester and eastward through southern NH over u1lity rights of way Going through permiing process now Proposed in- service date November 2018

6 Pipeline Route, Eastern NY to Dracut Mass.

7 Pipeline Route: Winchester NH

8 Local Background: Vernon s tax base Entergy % of Total Grand List % 90.00% 80.00% 70.00% 60.00% 50.00% % of Total Paid 40.00% 30.00% 20.00% 10.00% 0.00%

9 Local Background: What replaces Vermont Yankee? The assump1ons in Vernon have been: When VY s license expires, it should be replaced by a gas genera1ng plant The property is going to remain industrial and earmarked for energy genera1on There s a pre- exis1ng connec1on to the grid

10 Opportunity: A gas- fired electric genera1ng plant in Vernon Size: About 600 megawaus, approximately equal to VY Acreage: 40 acres during construc1on, 20 acres post- construc1on Building: Power block feet tall with stack feet (same as exis1ng VY stack) Grid connec1on: to exis1ng VELCO switchyard and substa1on Pipeline connec1on: via a 7- mile spur, all via exis1ng u1lity rights of way Cost: $750 million (+/- 10%)

11 Why in Vernon? Exis1ng infrastructure for grid connec1on: VELCO switchyard Proximity to pipeline route (no other town in VT is as close) Proximity to Interstate highway, railroad Proximity to Connec1cut River (to draw makeup cooling water very liule, if any, elevated temperature water released back to the river)

12 What would it look like? 530 MW gas plant in Nevada

13 Schema1c of 650 MW GE combined cycle gas plant

14 Possible loca1ons Within a reasonable distance of exis1ng substa1on & switchyard Op1ons include: On Entergy- owned property outside the protected area of Vermont Yankee On other property in the vicinity Needs only 20 acres plus 20 acres temporarily during construc1on

15 Where would it be?

16 Employment, economic benefits? During construc1on: jobs over months Total plant employment: Contractor employment as at VY, for outages and maintenance Mul1plier effect: 50% or more Helps stabilize local real estate values

17 Employment, economic benefits? Possible addi1onal users of natural gas in Vernon, BraUleboro and Putney, including residen1al and commercial use, if pipeline is extended. Some commercial users are now trucking in natural gas and would benefit from lower rates Helps lower & stabilize regional electricity rates Helps address New England grid shortages Helps balance renewables genera1on in VT and diversify energy sourcing

18 Effect on Vernon Property Taxes Grand list value of VY before shutdown: $300 million Grand list value of a gas plant: up to $750 million Gas plant starts at the top of the deprecia1on curve. Preserves the taxable value of the exis1ng switchyard & substa1on

19 Environmental impacts Emissions: Versus older genera1ng units in the New England power pool: 94 percent fewer pollutant emissions and 36 percent less greenhouse gas emissions. Constant emissions monitoring. Noise: no significant offsite noise (60 db at the fenceline like AC unit at 100 feet) Visual impact: 15% of VY footprint, less light Traffic: much less than VY (5% of the employment) Insignificant if any elevated temperature water added to the Connec1cut river (much less than VY) Short- term construc1on traffic impacts reduced by rail access

20 What about renewables? Currently, solar and wind are intermiuent sources Any electric grid relying on solar and wind needs a backup source (or storage) for when sunshine or wind are not genera1ng power Storage technology is not yet economically available Gas is the cleanest, most cost effec1ve op1on for backup power

21 Is it safe? What are the risks? Kinder- Morgan: excellent safety record for its gas pipelines Overall safety record of gas plants and long- distance gas pipelines is very safe Middletown CT: gas plant explosion during startup phase

22 Where s the gas from? What about fracking? The pipeline would bring fracked gas from the Marcellus gas field in Pennsylvania. Gas extrac1on has been going on for 10+ years, fully permiued, at Marcellus. Whether a gas plant is built here or not will not impact the volume of gas extrac1on at Marcellus. Petroleum fuels are derived from fracked hydrocarbon products as well. Industry consolida1on has led to considerable improvements in the extrac1on process; goal is less than 1% leakage.

23 What are the steps involved? Community buy- in Pipeline receives final approval by FERC Concurrently: Developers complete feasibility and design work, fully on spec Secure capacity nomina1on from Kinder Morgan on NED pipeline Federal Clean Air Act permit (EPA) File for ISO- New England inter- connec1on approval State approvals (Sec1on 248 of Title 30, PSB) Construc1on

24 Who pays for it? Two stages: Development stage: high- risk private investment (venture capital type) Construc1on stage: bond and equity funding via private equity investors NO public funding or cost to: Town of Vernon State of Vermont Vermont consumers

25 When would it be in opera1on, and for how long? Construc1on can be concurrent with pipeline construc1on Plant in opera1on by 2019 or 2020 Expected useful life of the plant: as long as the plant is compe11ve

26 Planning Board members visit to Middletown CT gas genera1ng plant Tour on November 2, 2015 Generates

27 Tour on November 2, 2015 Generates 620 MW of electricity Visible focus on safety, cleanliness, and security Security fence surrounds site, and entrance is through two gates Minimal noise from the plant Burns natural gas piped from Texas, with diesel fuel as backup

28 Employs 23 persons, with just two operators on nights and weekends Operator control room with large video screens had one operator Plant is located in a closed feldspar quarry above the Connec1cut River, surrounded by rock walls on three sides The plant u1lizes approximately 3 million gallons per day of water pumped from two wells 25- feet beneath the river bed Approximately 85% of the water is lost as steam to the atmosphere from 10 cooling towers adjacent to the plant There is no discharge of heated water into the river or the ground

29 There are two 220- foot high stacks that exhaust gas from the turbines An air permit from the state of Connec1cut sets a noise limit of 60 decibels at the fence line The plant is owned by Ares, an energy investment company, who contracts with PPM, an asset management firm, who subcontracts with NAES for opera1on Power from the plant is sold at prices that vary significantly based on a number of factors. This past year it operated at an 80% capacity factor. There are scheduled outages for approximately 21 days per year, and a major outage every 6 years for approximately 30 days. In 2013 there was a forced outage of 42 days

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