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Municipal Electric & Gas Alliance

Tompkins County – Carbon Footprint Shrinks with Hydro

Tompkins County – Carbon Footprint Shrinks with Hydro

By on Mar 23, 2016

56f2e19985413.imageAt the March 15 meeting of the Tompkins County Legislature, the board unanimously voted in favor of entering into an agreement that would allow the county government to receive about 63 percent of its electricity to power county buildings and operations from a 100-year-old hydroelectric facility in Waterloo.

Omay Elphick, director of business development for Gravity Renewables, Inc., gave a presentation about the two-megawatt facility, located on the Cayuga-Seneca Canal. In 2014 the county and the company agreed that, in the event Gravity would be able to acquire the property and the license, it would offer the remote net metering opportunity to Tompkins County.

Gravity aims to bring long-term, cost-effective clean energy to electricity consumers and owns and operates 31 megawatts of hydroelectric projects across the United States that are either already operating or under development. The Gravity Renewables option is the result of a joint procurement authorized by the legislature in 2013, involving Tompkins County and the Municipal Electric and Gas Alliance (MEGA).

Monetary remote net metering enables the county to purchase electric power from a renewable energy facility and consequently receive a deduction on its electric bill. The size of the deduction is based on the amount of electricity the facility injects into the grid. According to county attorney Jonathan Wood, the county need not invest any land or capital in the project.

The 20-year agreement between Gravity and the county will come up for renewal every five years and, by mutual agreement, including one five-year renewal period option at the end of the 20 years, extending the agreement to 25 years total.

The county will receive a credit on its electric bill for each kilowatt-hour, the value of which will vary depending on the market. The average annual savings to the county is estimated at $39,000 annually for a savings of $735,000 over 20 years. The favorable pricing structure was secured through the MEGA proposal and subsequent New York State Public Service Commission (PSC) rulings. Even though the monetary crediting program has been canceled by the PSC, due in part to unanticipated costs savings to the consumer, or “unintended economical arbitrage,” the Waterloo project has been grandfathered in.

The tax credits act as a hedge against increasing energy prices that could cost taxpayers in the future, said Wood. The partnership aims to reduce and stabilize energy costs.

The hydro plant was originally built in 1916. The facility, formerly privately-owned, is in working order and currently feeding power into the grid, but is in great need of upgrades, Elphick said. “Gravity is acquiring the plant with the long-term commitment of refurbishing it but using the existing equipment,” he said. “When we refurbish the plant we’re not importing anything from overseas. We’re using equipment that’s already here locally, local contractors, and local machine shops.”

Hydropower is not tax exempt, and the facility will continue to pay property taxes. The estimated annual New York economic impact per one megawatt is $50,000 to $100,000 per year in taxes, wages and local spending, Elphick said during his presentation to the board.

The environmental benefits include an estimated annual carbon savings equivalent to 2,620 metric tons. The county will retain rights to all environmental attributes in the form of renewable energy certificates (RECs), and Elphick said the county would receive an estimated 3,850 RECs per year, which have an estimated total future value of $25,000 to $100,000.

“This is just one more example of how Tompkins County is a leader and out in front,” said Michael Lane, Tompkins County Legislature chair, “and what better way to generate electricity for our needs than by using the oldest method in history?”