Clear 29° Good Morning
Clear 29° Good Morning

LI employers commit to preserve 60,000 jobs for cheap power

Northwell Health is the largest recipient on Long

Northwell Health is the largest recipient on Long Island of cheap electricity from the state Power Authority. Among those using the power is Long Island Jewish Medical Center in New Hyde Park, where nurses, seen here, work in the cardiothoracic ICU. Photo Credit: Chuck Fadely

Employers across New York State have committed to preserving and creating nearly 401,000 jobs, — including 60,000 on Long Island, — in return for access to discounted electricity from the state Power Authority, according to a new report.

The authority, in the first official review of its ReCharge New York program, said businesses, hospitals and nonprofits saved $89.5 million statewide in 2014, the most recently available data. On the Island employers saved $12.5 million.

The four-year-old program had 741 participants as of Dec. 1, 2015; 148 were in Nassau and Suffolk counties, including CA Inc., Pall Corp. and Canon U.S.A.

In return for lower electric bills, the participants have agreed to maintain, and in some cases, expand their payrolls over seven years. They also have pledged to invest $33 billion in buildings and equipment; $3 billion of it locally, said the report, which the authority was required to deliver to Gov. Andrew M. Cuomo and the State Legislature last month.

The 45-page document also shows a big increase in the number of companies and nonprofits benefiting from ReCharge compared with its predecessor programs, Power for Jobs and Energy Cost Savings Benefit: a gain of 52 percent statewide and 179 percent on Long Island.

“We always expected that ReCharge NY would be a successful program because of the improvements made from Power for Jobs,” said Gil C. Quiniones, the Power Authority’s chief executive since 2011.

ReCharge has more cheap electricity to distribute than Power for Jobs did, offers contracts of seven years instead of three years or one year, and the application process has been simplified, he said on Monday.

Another key difference is ReCharge allocations consist of electricity purchased by the authority from other producers and cheap electricity from the authority’s hydroelectric dams near Niagara Falls and along the St. Lawrence River.

Power for Jobs didn’t use the authority’s hydropower, only its nuclear energy from a plant in upstate Oswego that has since been sold to a private operator. The authority stopped taking applications for new allocations under Power for Jobs in 2003.

Quiniones said ReCharge “utilizes NYPA hydropower, which is some of the cleanest, most reliable and consistently inexpensive power available. . . . ReCharge NY power on Long Island costs roughly 20 percent less than power purchased at standard PSEG tariff rates.”

PSEG, Long Island’s principal supplier of electricity, delivers ReCharge allocations to local employers and charges them a delivery fee.

Locally, the largest ReCharge allocation goes to Northwell Health, formerly the North Shore-Long Island Jewish Health System, for hospitals in Manhasset, New Hyde Park, Huntington and Bay Shore.

In return for 5,506 kilowatts per hour, Northwell has promised to maintain a workforce of 17,415 people at the four hospitals. A thousand kilowatts are capable of powering 800 to 1,000 homes.

Frank E. Porretto, energy manager at Northwell, said the health system saves $1.6 million per year, or 10 percent to 15 percent off its electric bills, because of ReCharge power. The savings also include allocations for two hospitals in New York City.

“When we save money for energy, we can spend that savings for health care,” he said. “We can employ more nurses, for example, and when we can enhance our nursing staff, that means better care for our patients.”

Porretto also said the larger ReCharge program supports six of Northwell’s facilities; Power for Jobs only backed two.

NBTY Inc. has ReCharge allocations for five factories in Suffolk, up from one plant under the old program. The vitamin maker receives 3,940 kilowatts, the second largest allocation on Long Island, in return for preserving 2,457 jobs.

“We have seen significant cost savings, which has allowed us to use those funds for additional capital programs, employment and building our brands, said company spokeswoman Andrea Staub.

However, the transition to ReCharge from Power for Jobs angered some local participants in the winter of 2012-13 after unexpected price spikes of tens of thousands of dollars. Some threatened to leave the state.

The authority responded by introducing an “energy hedging strategy that reduces the impact of sudden swings in energy prices related to market purchases and a monthly capping mechanism whereby the price in any individual month cannot exceed a certain rate,” said Quiniones.

He also predicted ReCharge customers would benefit from recent declines in energy prices because half of their allocation is electricity priced at market rates and the other half is hydropower.

Quiniones said, “The hydropower component of the allocation has been historically cheaper than market power on Long Island, working to ensure that the total ReCharge NY allocation costs less than solely market power.”

More news