State study on sewer district windmill refutes private report: 'Not worth it'
Credit: By John Stefans, Riverhead Patch, riverhead.patch.com 5 May 2011 ~~
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The New York Power Authority said Wednesday that a proposed windmill to provide power to the sewer district’s treatment plant off Riverside Drive would cost much more to build and would save far less in electricity costs than was estimated by a study undertaken by a private consulting firm.
Consultants from the London-based Neutral Group had originally projected that the total cost of installing a 275-foot-high, 750-kilowatt wind turbine would come to $1.6 million and would save sewer district taxpayers some $5 million in electricity costs over the expected 25-year life of the windmill.
But in a report presented Wednesday to Supervisor Sean Walter and Councilman George Gabrielsen, NYPA put the estimated cost at $2.625 million – more than $1 million above what Neutral projected – and said that instead of lowering electricity costs, the project would end up costing more money than what the Long Island Power Authority would charge for power.
Even after Neutral upped its cost estimate to $2.295 million, explaining that it had failed to include certain “soft costs” into its initial projections, NYPA still called the expense and savings projections unrealistic and stood by its conclusion that the wind turbine had a “negative net present value.”
Neutral’s changing its cost estimate also prompted Gabrielsen to charge the private consultants with being less than candid.
“When they came to the town board, they weren’t upfront with us,” Gabrielsen said Wednesday, referring to a presentation in February by Peter Rusy of the Neutral Group.
“This has been a problem for this town for years. We take too much for granted,” he said. “I can see the landfill again. The DEC says cap it, and we went with reclamation.”
The example he cited was the town’s decision in 2002 – based on what turned out to be faulty information – to reclaim the Youngs Avenue dump instead of capping it, as all other East End towns had done with their landfills.
It was only after work to reclaim the landfill ran up costs of more than $40 million – with less than two-thirds of the project completed – that the town decided to cap.
Gabrielsen emphasized, however, that wind turbine idea might not be completely dead, particularly after a $470,000 grant to the town – announced in April by the state’s Environmental Facilities Corporation but not considered by NYPA in its report— is factored into the equation.
He said that he and Walter had asked NYPA to revisit the numbers to take the grant into account and to determine whether state money would change the economics of the project enough to move ahead.
“In my mind, that’s the only thing that’s going to save it,” Gabrielsen said.
He also said that another negative is that the windmill, which would be the tallest structure of its kind on Long Island, would necessitate a “topple zone” so large that it would encroach on a parcel of property along Riverside Drive that the town purchased in 2006 as an open space acquisition out of its land preservation fund.
Neutral’s feasibility report states, “It was confirmed that such setback from the adjacent Town of Riverhead protected land would not be required.” But, it added, this would be “subject to the installation of an appropriate fence on the relevant land parcels to restrict public access within the topple radius.”
Gabrielsen said he would have to look into whether a fence that restricts public access to public land would be allowed, noting that he had already received a letter from a member of the town’s Open Space Committee raising concerns about the issue.
Sewer District Superintendent Michael Reichel, a strong proponent of the windmill who ordered the Neutral study, said Thursday that the NYPA report was overly conservative, saying that its numbers overestimated the cost of the project and underestimated the effects of future LIPA price hikes.
NYPA’s report, he said, presumed a 2.5 percent average yearly price increase in the cost of electricity, while Neutral’s study presumed an average yearly increase of 5 percent.
“They used rate-hike figures from upstate, not from here,” Reichel said. “It’s been years since we’ve seen an average price increase of only 2.5 percent on Long Island.”
Residents who live near the site of the proposed windmill have expressed disapproval of the project, evidenced by ten letters the town received from area homeowners following a public hearing in February.
Given that opposition, Walter had said he would be willing to call a second public hearing should it appear that the project were moving ahead.
But on Thursday he said that the next step will be to invite representatives from NYPA to brief the entire town board at a work session after factoring in the impact of the $470,000 energy grant.
“They’re the experts. If they’re fine with it, then I’m fine with it,” he said, although he said that he would insist that NYPA and not the Neutral Group oversee the project if it were to ultimately be approved.
According to Reichel, the sewer district paid the Neutral Group $32,000 for its feasibility study. Another $12,000 was spent to erect a device to measure wind speeds at the site.
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