Somerset Operating Company to close in 90 days

BARKER — Somerset Operating Company on Monday announced plans to close the large coal-burning electricity generating plant in 90 days, a move that is likely to result in dozens of layoffs and cost the Town of Somerset one of its largest taxpayers.

The closure has been expected since early May, when the state Department of Environmental Conservation announced it was adopting more “stringent” carbon dioxide emissions limits for power plants, intended to phase out the use of coal in energy generation.

In a deactivation notice filed with state regulators on Nov. 15, the plant owner, Hereot Power Holdings, cited the stricter emissions rules as well as “deteriorating market conditions.”

The New York Independent System Operator (NYISO) and the New York State Public Service Commission will assess Hereot’s deactivation request. 

If NYISO determines the plant is needed to ensure a reliable power grid, the plant will not be able to shut down as planned, according to Somerset Supervisor Daniel Engert.

“There’s a small ray of hope that the plant won’t be able to shut down because of reliability of the grid,” Engert said.

The 685-megawatt facility, located on Lake Road, employs 55 people, down from a peak of 210 employees. If the closure is approved, those remaining employees are expected to be laid off, except for some who may be retained for remediation and plant closure work. 

The closure will mark the end of coal-fired energy generation in the state. 

Heorot shuttered its coal-burning plant in Tompkins County, the Cayuga Operating Company, on Oct. 31, also citing the stricter state emissions standards and market conditions. The Cayuga plant filed its deactivation notice June 28.

Heorot has proposed repurposing both sites into data centers, including a 500 MW center in Somerset and a 100 MW center in Cayuga. 

In July, New York Power Authority awarded the company 10 MW of hydropower, far less than the 125 MW that Heorot had sought for its proposal. Heorot is seeking an additional power allocation from NYPA and economic assistance from Empire State Development.

“It would enable us to address the governor’s environmental policy goal of eliminating coal while also transitioning to a new greener economy in New York, said Michael Enright, managing director of Beowulf Energy LLC, which manages the Somerset plant.

Engert said state agencies are continuing to meet with company representatives to “contemplate what is required” to move the data hub proposal forward.

Engert also slammed the state’s “unattainable” new air emissions rules, saying they “intentionally” put Heorot’s two power plants out of business.  He urged the state to offer tuition assistance and job-training for employees who are laid off and unable to find work at another energy facility.

“It’s unfortunate but not surprising,” Engert said. “I’m disappointed for the employees. I’m still waiting for the governor and the state ... to step up and demonstrate how they’re going to assist these employees.”

Heorot has not yet determined whether it will demolish the facility. Spokeswoman Minda Conroe said Heorot will follow a state-required decommissioning plan if regulators determine the structures are needed for a potential data hub.

“The data hub would likely require new modular buildings to house high speed computer infrastructure,” Conroe said in a statement. “How the data hub would interface with other structures has not yet been determined.”

Meanwhile, the town is planning to develop a waterfront park atop a 250-foot-tall landfill containing coal ash from the plant. 

Last month, the state’s Lake Ontario Resiliency and Economic Development Initiative awarded $1.3 million to the town to stabilize a roughly 2,000-foot stretch of the shoreline with “natural or nature-based” protection measures.

The town also received $36,000 in December 2018 to conduct a feasibility study on the planned park. That study is nearly complete and its findings indicate “all signs are positive,” Engert said.

Engert added the town will apply for additional state funding to build access roads and other park infrastructure.

“That was always the intention of the property. The town is making steps to make that a reality,” Engert said.

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