Fort Drum power plant sale approved

FORT DRUM — The state Public Service Commission approved the sale of the power plant on post Thursday morning, one piece in a series of actions that will lead to the renovation of the plant, which had employed 35 before it shut down in 2010.

ReEnergy Holdings LLC, Latham, sought PSC approval to buy the Second Street power plant from United States Power Fund LP.

If the deal closes, ReEnergy Black River LLC — a subsidiary of ReEnergy Holdings — will convert the 50-megawatt plant from coal to biomass fuel, primarily wood chips, but also tires and solid fuels, according to the petition it filed with the PSC on April 22.

On Tuesday, officials from ReEnergy did not want to delve into specifics, as the deal still has to be finalized.

Rep. William L. Owens, D-Plattsburgh, said the process is continuing from a deal previously approved to sell the plant to Catalyst Renewables, Dallas.

“From my perspective, the deal really hasn’t changed,” he said. “As long as we’re going forward with the project, that’s our goal there.”

Sen. Charles E. Schumer, D-N.Y., also pledged his support for the deal.

“By converting the Fort Drum cogeneration plant to biomass and away from a polluting fuel like coal, ReEnergy is paving the way for a cleaner energy economy in the north country,” he said in a news release. “Clean energy can mean big business in the North Country. I will help make this happen however I can, and I urge the new owners to turn this plant into jobs, jobs and more jobs.”

The Fort Drum facility is authorized now to burn bituminous coal, anthracite coal, fuel oil, wood, petroleum coke, tire-derived fuel and other fuels. ReEnergy Black River plans to convert it to a wood, tire-derived and other fuel facility.

“We want to make sure we get Fort Drum off the grid,” Mr. Owens said. “I think that’s really important and we like the idea that it’s a renewable energy project and is going to create some jobs.”

The facility originally was a cogeneration plant that supplied buildings on post with steam and sold power to Niagara Mohawk Power Corp. That steam contract was in effect from 1988 to 1998.

The facility has changed hands several times. United States Power Fund LP bought it on May 26, 2004, and ran it under Black River Generation LLC.

The facility leases 11.8 acres from the Army, which owns all property on post. It wants another 4.2 acres leased from the Army to process and store wood fuel.

“I will continue to assist the companies in their endeavors to get the project approved,” Mr. Owens said.

The parties need to agree on that lease and a fair price for the electricity to be sold to the instillation.

In the past, the plant employed up to 35 people and paid property taxes to the town of LeRay, Carthage Central School District and Jefferson County for the improvements on the tax-exempt property. Up to $2.5 million in payroll and $4.5 million in spending came from the plant.

ReEnergy Black River was created by ReEnergy Holdings to acquire the generation plant at Fort Drum. ReEnergy Holdings is a portfolio company of Riverstone Holdings LLC, an energy and power-focused private equity firm that manages nearly $16 billion of investments in the energy industry.

As a biomass facility, it no longer would fall under the PSC’s purview, where it has been because of the coal fuel.