Making a Silk Purse out of a Sow’s Ear: Repurposing New York’s Fossil Generation Sites for Renewable Development

By Fred Zalcman, Director, NYOWA

Embedded among the hundreds of policy proposals unveiled in her 2022 State of the State address, Governor Kathy Hochul announced that her administration would henceforth incentivize the conversion of the state’s aging fleet of fossil-fired generating plants to serve its push for clean and renewable resources. While this provision received little notice at the time, it potentially holds the key to unlocking the state’s growing appetite for offshore wind generation and meeting its nation-leading targets for weaning itself off fossil fuels.

Indeed, New York’s landmark 2019 Climate Leadership and Community Protection Act (CLCPA) calls for the state to derive 70 percent of its electricity from renewable energy sources by 2030 and to decarbonize its grid by 2040. Meeting these aggressive targets will require massive investment in new sources of generation, such as solar, land-based and offshore wind, and other renewable resources, and the transmission capabilities to connect these renewable power sources to New York’s load centers. It will also require significant investment in human capital to build a trained workforce, representative of New York’s diverse population, with the skills and experience to construct and operate these projects. Furthermore, reducing the environmental burden posed by burning fossil fuels for electric generation on New York’s frontline communities will require vision, active engagement, and policy innovation.

Fossil generation accounts for 13% of statewide greenhouse gas emissions, according to the Climate Council’s Draft Scoping Plan, a roadmap for achieving CLCPA targets (see chart below).

While coal has been all but eliminated as a feedstock, New York’s generation fleet today relies primarily on natural gas. Quite apart from the CLCPA plans for a carbon-free grid, these plants are already coming under increased cost pressure in the form of more stringent environmental regulations. These include New York State’s “Peaker Rule”, which impose increasingly tighter restrictions on emissions of smog precursors and affect 3,300 MW of peaking generation statewide. Additionally, New York City has barred the use of #6 and #4 fuel oils for fossil generation by 2020 and 2025, respectively, affecting those generating stations in New York City that are dual-fuel capable. By effectively restricting the usage of these facilities, or increasing their cost of compliance, environmental regulations are putting in question the continued viability of these plants. This is already starting to play out; the latest NYISO Gold Book identifies a slew of planned deactivations.

In conjunction with these regulatory “sticks,” New York is seeking to induce the creative reutilization of fossil plant sites. NYSERDA’s latest offshore wind solicitation would give additional scoring credit to project developers who, at their discretion, propose the repurposing of fossil generation infrastructure located in New York ISO regions Zones J or K (New York and Long Island, respectively).

Beyond these regulatory inducements, downstate fossil plant sites possess key attributes that should make them attractive targets for offshore wind developers – in real estate parlance: “location, location, location.” These sites are invariably located on the waterfront, allowing (relatively) easier “landfall” for the cables connecting the distant offshore wind farms to the onshore grid. Additionally, these sites often have (or can create through demolition of antiquated structures) surplus land available to support offshore wind development activities, including the location of substations, O&M servicing centers and warehouses and the like. Lastly, and perhaps most importantly, these plants can allocate hundreds of megawatts of interconnection rights to the offshore wind project, avoiding costly system upgrades.

Given these strong market fundamentals, it should come as no surprise that several repurposing proposals have surfaced. These include:

·       Brooklyn Clean Energy Hub Con Edison, New York City’s distribution utility has proposed using a portion of its properties in the Vinegar Hill section of Brooklyn for the construction of a dedicated substation to connect up to 6,000 MW of offshore wind to the New York transmission grid. The company contends that the Hub will reduce the cost and delay risks associated with required upgrades to other parts of the Con Edison distribution system to accommodate this massive volume of OSW generation flowing into New York City and beyond. The New York Public Service Commission (PSC) is currently considering whether to authorize cost recovery for this $1 billion infrastructure project.

·       Astoria Generating Station Repurposing Equinor, an offshore wind developer, and NRG, the current owner of the 1960’s vintage Astoria Generating Station in Queens, have jointly petitioned the PSC to approve the sale and transfer of properties at the plant site to serve as a point of interconnection for the 1,230 MW Beacon Wind 1 project. The sale was  negotiated after NRG was unsuccessful in its pitch to regulators to repower the existing generation with newer gas-fired turbines that could ultimately be run on renewable-based fuels. The New York Department of Environmental Conservation rejected this proposal, citing the CLCPA’s carbon reduction mandates as the basis for denying necessary air permits. 

·       “Renewable Ravenswood” RISE Power and Light and its parent company, LS Power, owners of the Ravenswood power plant aka “Big Allis”, New York City’s largest generating station, are proposing a multi-faceted transformation of this 27-acre East River site. Among other things, Renewable Ravenswood contemplates the integration of nearly 4 GW of offshore wind capacity. RISE will be seeking regulatory approvals for this transformation beginning later this year.

While the primary impetus for these projects is the transition from a fossil-based economy to one powered entirely by clean and renewable energy, it is clear that these projects are more than “just about the electrons.” This is illustrated by the Renewable Ravenswood project, which among other project goals, seeks to bolster a Just Transition by deploying the Ravenswood plant’s existing workforce to new workstreams and promoting environmental justice by reducing the pollutants that give the Queens East River waterfront the ignominious title of “Asthma Alley.”

Through the innovative reuse of New York’s aging energy infrastructure, smokestacks reminiscent of a bygone era are giving way to clean energy hubs that will generate and deliver clean energy from a multitude of new sources. New York is showing the way that this energy transformation can be accomplished in a way that is consumer friendly, addresses the needs of disadvantaged communities, and provides continuing opportunity for former power plant workers and the hard working men and women of the building trades.