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Report lauds planned coal plant 'Clean' facility seen as generator for jobs

Building a new clean-coal power plant at the site of the Huntley Station in the Town of Tonawanda would pump an estimated $133 million a year into the Erie County economy during its construction and a projected $94 million a year once the facility is running, a study to be released today found.

The study, paid for by the proposed plant's developer, NRG Energy, as it tries to win backing from the Spitzer administration, predicts that the $1.5 billion project would have a much greater impact on the Buffalo Niagara economy than its initial price tag.

The project, however, has been slowed in its early stages by questions over whether the power it generates would cost too much and concerns over the viability of new techniques to capture and safely store carbon dioxide emissions.

NRG executives said they believe they have addressed those concerns. The NRG study said the project would generate more than 1,950 new jobs during the five-year construction phase that would begin next year and run through 2013, when NRG hopes to have the 630-megawatt clean-coal power plant ready to open.

After that, the plant, which is expected to create about 100 jobs associated with the facility's operations, would support a total of almost 550 new jobs throughout Erie County between the additional employment at the plant and the spin-off jobs generated by new spending spawned by the power station and its work force.
In all, the economic impact study prepared by Regional Economic Models, an Amherst, Mass.-based consulting firm, predicted that the clean-coal project would pump $3.33 billion into the Erie County economy from 2008 through 2043 and generate an additional $1.4 billion in real disposable personal income for its residents.

"This is real economic development for the Western New York area that is unprecedented," said Raymond G. Long, NRG's director for the northeast region. "This could be an economic engine that would drive this area for a long period of time."

NRG executives are releasing the study as they try to win the final state approvals needed for construction to begin. The Pataki administration, in its final days, gave the Huntley project conditional approval last December, but also told NRG that it must revise its plans to reduce the cost of the plant's electricity, which would have been too high to attract buyers. The company also was told to solidify plans to store the carbon dioxide generated by the plant in underground formations.

While NRG officials said the company has submitted revised plans that address those concerns, state officials still have not signed off on the project, and the Spitzer administration has some reservations about the clean-coal initiative.

NRG already has spent $9 million on the project and is nearing the point next year when it will move into a more advanced design and permitting stage that will require an investment averaging about $2 million a month, Long said.

"The timing on this is critical," he said. "We need to have that [state] contract signed and have the state behind us 100 percent on this project."

The Huntley Station won a statewide competition organized by the Pataki administration for a clean-coal power plant that would help ease the electricity shortage that energy experts predict will hit the state within the next decade.

The Huntley project also would produce immediate environmental benefits by replacing an aging power plant, which has long been criticized by environmentalists as one of the dirtiest in the nation.

While the new plant would immediately reduce emissions of sulfur dioxide and nitrogen oxide -- a prime cause of acid rain -- the Huntley plan also calls for the carbon dioxide produced by the plant to be captured and then stored in underground formations.

But that technology to capture and store carbon dioxide -- a main cause of global warming -- is in its early stages and is only now being tested in demonstration projects, although Long is confident the process contemplated by NRG is both practical and cost effective.

Western New York's geology is favorable to sequestration -- a process where the carbon dioxide gas is converted into a liquid and then pumped into salt water formations a mile underground, where it is unlikely to leak back into the atmosphere.

"This project will not start up without sequestration," Long said.

The Huntley project is the biggest of two clean-coal power plants that are on the drawing board in Western New York. The municipal utility in Jamestown is proposing to build a $145 million new clean-coal power plant in Jamestown that would use a different technology than NRG.

In addition, the University at Buffalo has shown interest in forming a research and education center to study clean coal and carbon dioxide sequestration issues.

"Putting all these pieces together yields a project that has a huge economic impact," Long said.


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