GenOn Energy, Inc. _ Bowline 3 and Lovett ... - Energy Highway

Having owned and operated electric generation facilities in new York since 1999, GenOn is
very familiar with issues related to the local availability of labor, materials, and installation
equipment. In general, we anticipate that the Bowline 3 project will be built utilizing a skilled
unionized workforce in a manner similar to other construction projects that GenOn is
currently executing in other parts of the country. Depending on market conditions at
the time construction commences, we believe that skilled, unionized labor will be available
in sufficient quantities, either locally or from neighboring regions, to execute the project
in a cost-effective and timely manner. GenOn historically has enjoyed good relations with
building and construction trades groups. The ongoing construction of the company’s
marsh Landing plant in California, for example, has benefited substantially from the highlyproductive,
quality-focused efforts of numerous building and construction trades groups
working on the project.
opeRatIonal
GenOn has significant experience with the ownership and operation of power generation
facilities that contain explicit guarantees related to project availability and performance.
Although GenOn is not yet aware of the exact structure that new York will offer in support
of Energy Highway projects, it is our expectation that such structures will require Bowline 3
to operate at a high level of availability and performance.
GenOn has a strong, company-wide commitment to safety. we promote a safe and healthful
work environment, communicate safety issues, use safe work practices and provide
ongoing safety training for our employees. For both construction projects and plant operations,
GenOn maintains a comprehensive safety program and manual that together set a
high standard for safety. In addition, we require that all our contractors commit to a set of
safety procedures that are at least as rigorous and comprehensive as our own.
Bowline 3 will also maintain a comprehensive plan for addressing emergency situations. In
addition, we expect to contract with local entities to provide emergency response services
to the plant.
socIo-economIc
The construction and operation of major infrastructure projects such as Bowline 3 typically
provide a variety of economic benefits to the communities in which they are located.
These benefits typically include the provision of well-paying jobs, tax revenue, and other
forms of associated community benefits and economic development.
Although construction plans remain to be finalized, projects of similar size and type as
Bowline 3 are capable of creating up to 700 skilled construction jobs during the plant
construction period and up to 25 high-quality, permanent jobs for personnel to operate the
plant once it is completed. In addition, Bowline 3 will support hundreds of other local jobs
among vendors and suppliers.
As is typical for projects of this type, GenOn will seek to negotiate a PILOT (Payment in Lieu
of Taxes) agreement that will represent a long-term source of revenue for the town government
and the local school district. Besides assisting the local community by maintaining a
stable tax base, a PILOT agreement is required to stabilize the project’s long-term operating
costs, which in turn is a prerequisite for GenOn to arrange a debt financing package for
the project.
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