AES submits plan to shut down plant in March 2011

DRESDEN—AES Greenidge has submitted plans to close the Dresden coal and biomass burning plant until it becomes more cost effective to operate.
The parent company, AES AEE2, LLC submitted the plan with the New York State Public Service Commission in September.  According to the document, AES wants to put the facility in “protective lay-up”, starting Friday, March 18, 2011.
In the form, AES AEE2 President Peter S. Norgeot, said the company deemed this necessary “in light of the market conditions and other circumstances.”
“Based on the current and forecasted wholesale electric prices in Central New York and current and pending environmental regulations, (the Dresden plant) is, and will continue to be, operating at a net loss,” he said.
Norgeot added the company wants to avoid permanently shutting the facility down, but for now needs to close the plant to limit costs.
Norgeot said the site is staffed by 40 direct employees, and “is one of the largest taxpayers in Yates County.”
AEE2 was required to notify the Public Service Commission.  This state agency regulates electric, natural gas, steam, telecommunications, and water.  Over the next six months the state will now review the company’s plan to shut down.
During that time, Norgeot said AEE2 will examine how to cut costs.  He explained the company will be “closely monitoring market conditions and circumstances that will allow it to continue - or reinstate - service from its Greenidge Unit 4 facility.”
AES Greenidge burns coal and biomass to create energy.  According to the document, since AEE2 purchased the facility, more than $40 million has been invested in the plant.
Norgeot added another $9 million was invested to convert some operations into biomass burning.  Up to 10 percent of the energy produced is from burning wood and wood by products.  He explained despite all these investments, the plant is still losing money.