Unless a buyer is found for the Greenidge power plant, Yates County’s most valuable property could face demolition in as little as six months. AES Eastern Energy, an Ithaca-based subsidiary of AES Corp., filed for Chapter 11 bankruptcy on Dec. 30, 2011.
According to AES Eastern Energy Greenidge President Bill Rady, president of AES Greenidge, the company’s six coal-fired power plants have been packaged for sale in two lots; the two large plants, Somerset and Cayuga, and the four smaller plants, Greenidge, Westover, Hickling, and Jennison. But no buyer has come forth, and two of the plants are already scheduled for the wrecking ball.
Rady says that of the four, Greenidge stands the best chance of purchase, being the most recently operated facility and most easily restarted. Hickling and Jennison have been shut down since 2000. But Rady holds out little hope that a buyer will come forward. “They are not economically viable to survive,” said Rady, adding, “Cheap gas and expensive coal, plus the environmental requirements of federal regulations are killing them."
The Cayuga and Somerset plants are still operating, but at reduced capacity due to low demand and reduced electricity price. While the coal fired energy industry is suffering as a whole, the Somerset and Cayuga plants are still viable, according to Rady, because they are larger, newer, and more efficient. The two plants are targeted to be sold to the bold holders as part of AES Eastern Energy’s Chapter 11 bankruptcy proceedings. Only the four smaller plants are being considered for demolition.
When asked about converting the Greenidge plant to natural gas as a fuel source, Rady said the company had judged that to also be not economically viable.
AES Eastern Energy just negotiated a reduction of Greenidge’s PILOT (Payment In Lieu Of Taxes) with Yates County and the Town of Torrey. From the originally agreed $1.1 million annual payment when it was operable, AES EE will pay just $600,000 this year and $400,000 next year. With the survival of the company so unsure, Steve Griffin of the Finger Lakes Economic Development Center suggested the arrangement as preferable to the $500,000 annual payments the company wanted.
Given its long history of heavy industrial use, many people have been concerned about the prospect of Yates County being saddled with another highly contaminated property that would be difficult to sell and repurpose.
Both Rady and Griffin stated that if Greenidge is demolished, court appointed trustees will ensure a complete cleanup of the site in the dissolution of the company properties.
“It’s in the trustees’ hands. They will do what needs to happen,” said Rady. “If it is demolished, it will be cleaned up.”
Ever optimistic, Griffin sees the large site with its extensive Seneca Lake frontage as an opportunity for a wide range of development possibilities.