Given Long Island's shaky history with the generation of electricity, our plans for an uncertain future are best made very carefully. While additional megawatts will be needed in the coming years, the amount is probably significantly less than what the Long Island Power Authority is trying to lock in with expensive long-term contracts.
LIPA's decision on Thursday to ask PSEG Long Island, the new operator of the system, to closely analyze the Island's needs and then review the costs of new projects is an important and welcome change from past practices. Some big questions:
How much additional power will actually be necessary?
What is the correct mix of fossil-fuel plants and renewables?
Will any new sources lead to the closing of legacy generating plants in Port Jefferson, Northport or Island Park?
In the next few months, LIPA is due to complete an estimated $3.3-billion, 20-year contract to buy 750 megawatts from a plant to be built in Yaphank. Caithness II, to be constructed alongside a plant owned by the same company, would come on line in 2018 and is projected to raise bills by about 3 percent. However, if history is any precedent, that figure is way too low.
Meanwhile, bidding closes Monday on LIPA's request for an additional 280 megawatts from renewable sources. Winners of those contracts are expected to be chosen in December. Along with bids for small, on-Island solar projects, there will be a proposal for a 200-megawatt offshore wind project east of Block Island.
A consensus to add at least 1,000 megawatts by 2018 was reached by the old LIPA board based on the expertise of then-system operator National Grid. Both are gone now. LIPA relied then on a 2010 consultant's report that forecast our needs for more power by 2018; it cited data from 2009. Now it's 2014, and the data do not account for overall reduced demand and increased efficiency.
Complicating the calculation is the concern that added supply from new sources might eliminate the need to upgrade the legacy plants owned by National Grid. While extra capacity would allow the old plants to be taken offline for renovation, it could also eliminate the need for an old plant altogether.
State Sen. Kenneth LaValle (R-Port Jefferson) opposes a full-sized Caithness II, but he is framing the issue narrowly in terms of the Port Jefferson plant that has kept a lid on local taxes in his district. His instincts might be right, but his attempt to stop the Caithness II contract by slipping language into the state budget was silly.
The concern, however, that ratepayers might get locked into an expensive contract with Caithness for unneeded power must be examined.
The New York Independent System Operator, the regulatory group that determines how much power each utility must have on hand, says 107 percent of LIPA's forecast peak demand must be generated on the Island. Using PSEG figures for 2014, that translates into a net peak load of 5,500 megawatts on the hottest days of the summer. For 2018, however, the forecast is for a net peak of 5,653. The small increase takes energy efficiency and the availability of more power statewide into account.
For years, LIPA has been criticized for its cozy relationships with politicians and contractors, and for profligate spending. Albany's 2013 LIPA Reform Act, a result of the huge dissatisfaction with the utility after superstorm Sandy, created a smaller board of trustees and assigned more responsibilities to PSEG, the operator that took over Jan. 1. But PSEG's responsibility for making decisions on power supply matters wasn't supposed to start until January 2015. That would have come only after decisions had already been made that will affect Long Islanders for two generations.
Fortunately, the timetable for PSEG's involvement has been moved up. At long last there will be a fresh perspective on how much power is needed and how renewables and upgrading older plants fit into the picture.
Goodness knows, we're still paying for LIPA's past mistakes.