THE LUYSTER CREEK ENERGY PROJECT ... - Energy Highway

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A S T O R I A G E N E R A T I N G Socio-Economic Potential benefits to and adverse impacts on the local economy The LCEP will have both direct and indirect positive economic effects, commencing during the construction phase and continuing throughout the economic life of the LCEP equipment. In the short term, the benefits of project construction will include additional employment and income stemming from jobs in the various construction trades that will be required to build the LCEP equipment. In the long term, the LCEP will provide an array of direct and indirect economic benefits. It will generate additional revenue for the City through additional tax payments based on the increased value of the Astoria Facility and enhance energy reliability to the City. The local economic impacts are also described above. Operation of LCEP equipment may have several tax implications. First, the modified Astoria Facility will be subject to a new tax appraisal and assessment for purposes of determining assessed valuation and property taxes. The new appraisal will increase the value of the Astoria Facility, which could result in higher taxes to be paid to the City of New York. The amount of the increase cannot be determined at this time. In addition, AGC may be able to qualify for local, state and federal tax incentives which may offset a portion of the estimated tax for the operation of LCEP equipment. The City will also benefit from the utility tax. The utility tax is levied based on the gross income of a facility on a monthly basis. The LCEP equipment will not only increase the capacity to provide power more efficiently, but it is anticipated that the LCEP equipment will also generate greater revenues through the utility tax. The extent of increased revenues cannot be determined at this time, particularly given the nature of the competitive energy market in New York State. However, it is expected that the City would realize a tax benefit from the LCEP. Once the LCEP equipment is operational, it is expected to require additional full-time staff of 25 to 30 employees. The total annual payroll for this additional workforce is estimated to be over $3 million per year. In addition to direct payroll, AGC currently expends over $ 100 million in operating, maintenance, and operation costs each year in the local community on goods and services. It is expected that the local expenditure will continue to be in this range and possibly higher due to the new equipment. The LCEP Equipment is expected to operate as a base load to intermediate duty facility. The LCEP equipment will also be available to rapidly start and quickly respond to changes in the electric system providing fast response typically unavailable from larger electric generating facilities. Prices paid to generators of electricity during peak demand times are generally higher than during normal demand periods because less efficient (more expensive) generating units are needed to meet the demand requirements. When the LCEP equipment operates it will displace higher cost generation, resulting in lower average costs to produce electricity. Potential impacts on real estate and property values The site of the LCEP is currently disturbed and is used for electric generation and ancillary activities. The LCEP will improve the site which is industrially zoned and therefore no adverse impacts will result to real estate or property values. THE LUYSTER CREEK ENERGY PROJECT MAY 30, 2012 11
A S T O R I A G E N E R A T I N G Impact on jobs, such as retention, creation of new jobs (temporary and permanent) and retraining opportunities Labor expenditures for construction of LCEP equipment will be substantial. The majority of this labor cost is expected to be paid to labor provided from New York metropolitan area. Efforts will be made to hire locally. In addition to local temporary jobs, the community will also benefit from additional direct non-payroll expenditures in the New York Metropolitan Area over the 24-month construction period. Once the LCEP equipment is operational, it is expected to require additional full-time staff of 25 to 30 employees. The total annual payroll for this additional workforce is estimated to be over $3 million per year. In addition to direct payroll, AGC currently expends over $100 million in operating, maintenance, and operation costs each year in the local community on goods and services. It is expected that the local expenditure will continue to be in this range and possibly higher due to the new equipment. Public safety concerns The operation of the LCEP is not anticipated result in any significant adverse impacts to the public safety and security in the vicinity of the project. Because the site is currently an active electric generating facility, there are Health and Safety Plans prepared and in effect. THE LUYSTER CREEK ENERGY PROJECT MAY 30, 2012 12
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THE LUYSTER CREEK ENERGY PROJECT ... - Energy Highway

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