Energy Project Q&A

Danskammer Repowering

Modernizing Danskammer through a repowering will produce a number of benefits for the State of New York and the Lower Hudson Valley including reducing emissions, ensuring power is available when you need it, and decreasing reliance on natural gas by creating a facility that uses gas more efficiently or, put more simply, gets “better gas mileage.”

Danskammer will continue to be used by the State of New York to produce energy, whether a new facility is built or the old one continues to operate. This is especially true in times of increased need (very hot and very cold days), and when other power facilities are retired in the coming years. The State’s electric grid operator (NYISO) has indicated that when planned retirements of existing facilities in the region occur, existing facilities like Danskammer will be called upon more frequently to meet the needs of the grid. In its 2019 Power Trends Report NYISO also states that new facilities will only meet 75% of the need created by planned power plant closures. This means that older facilities with much higher emissions will be called upon more frequently to meet the needs of customers. Many of the facilities in the Lower Hudson Valley are more than 50 years old and use antiquated equipment.

A modernized Danskammer will help fill the gap with state-of-the-art, cleaner technology, and help ensure older, less efficient plants are called upon less often.

Danskammer currently operates with antiquated equipment, much of which was commissioned in the 1950s and 1960s.

The modernized facility will be built directly adjacent to the existing facility. This means there is very little environmental impact from construction because no new pipelines or transmission infrastructure will be needed. It will generate up to 600 megawatts of electricity (enough to power roughly 500,000 homes) while using 50% less fuel – a huge gain in efficiency.

Additionally, when called upon by the State, the modernized plant will be able to produce electricity in minutes. The current facility needs about 11 hours to produce power, creating air emissions as it ramps up.

The building that presently houses Danskammer’s equipment and operations is well suited to accommodate battery storage, and the company is researching the possibility of a battery project in the old facility, should the new project be approved.

When New York meets its renewable goals with wind and solar installation, batteries would allow Danskammer to provide power when renewable sources like wind and solar might be under-producing.

If Danskammer’s repowering permits are not granted, the facility would continue to operate as it does today, and the space would not be available for battery storage.

The New York Independent System Operator (NYISO) is the organization that controls the state’s energy grid, and makes the decisions on when different power producers need to run statewide. Ultimately, NYISO will determine how often Danskammer runs, whether the plant is modernized or not. Current models show that a new Danskammer could run approximately 70% of the time.

NYISO has indicated that when planned retirements of existing facilities in the region occur, existing facilities like Danskammer will be called upon more frequently to meet the needs of the grid. A modernized Danskammer will offset the need to run older, higher-emission facilities.

The new Danskammer facility will be built farther back from the river and at higher elevations than the existing facility. The proposed new facility is outside of the projected 500-year flood zone, several feet above where the plant currently sits. Every precaution will be taken to protect the facility from flooding and mitigate the impact of any extreme weather events.

One of the benefits of installing new equipment adjacent to the old plant is there is no need for new infrastructure. The modernized equipment at Danskammer will be able to utilize the same connections to natural gas supply and to the grid.

The modernized equipment will be installed on the existing Danskammer site. When the new equipment is installed and is operational, the old equipment will be shut down. There will be no extension of the site itself.

Danskammer takes safety and security very seriously. The plant is in full compliance with all local, state and federal regulations. Additionally, we work closely with local emergency responders to ensure all parties are well prepared to handle an emergency.

Central Hudson is the public utility that provides many of the homes and businesses in the Lower Hudson Valley with natural gas. Danskammer is also a customer of Central Hudson and uses the same natural gas local residents use.

Central Hudson receives its gas from a pipeline that is interconnected with hundreds of other pipelines in the Northeast. Because all pipelines connect, like highways, natural gas from many locations is mingled together before it reaches Central Hudson and, ultimately, Danskammer.

Danskammer purchases natural gas from others and is not involved in any drilling activities. Fracking is prohibited in New York State.

Meeting New York’s Energy Needs

The New York Independent System Operator (NYISO) – the organization that controls New York’s energy grid – will continue to call on Danskammer to produce energy, especially in times of increased need and when older facilities retire in the next few years.

The State’s electric grid operator (NYISO) has indicated that when planned retirements of existing facilities in the region occur, existing facilities like Danskammer will be called upon more frequently to meet the needs of the grid. In its 2019 Power Trends Report NYISO also states that new facilities will only meet 75% of the need created by planned power plant closures. This means that older facilities with much higher emissions will be called upon more frequently to meet the needs of customers. These facilities are all more than 50 years old.

A modernized Danskammer will help fill the gap with state-of-the-art, cleaner technology, and help ensure older, less efficient plants are called upon less often.

Danskammer is supportive of the new Climate Leadership and Community Protection Act and believes in a responsible transition to a renewable energy future. Not only will a modernized facility significantly reduce the emissions that lead to climate change, it will also help serve as a bridge to meeting our renewable goals.

Currently, wind and solar energy resources produce less than 5% of the State’s baseload energy, and there are few renewable projects that have received the necessary approvals and permits to be built. The State has only added 100 megawatts of wind generation in the past five years. A modernized Danskammer will be capable of producing up to 600 megawatts of baseline power, by comparison.

It will take years before renewables needs are able to supply the needs of New Yorkers and this will only be accomplished with significant investment in storage. Additionally, resources like solar and wind do not produce energy consistently, 24/7. During times when the sun is not shining or the wind is not blowing, New Yorkers will need reliable, consistent sources of energy. A modernized Danskammer will be capable of producing up to 600 megawatts of power, and can support renewables by turning on quickly to fill the gap left when renewables aren’t operating.

No, modernizing Danskammer moves the state closer to the overall goal of reduced emissions and enables us to build a more efficient, reliable energy grid. Danskammer is a private investment that will not use taxpayer dollars, and in no way precludes investment in other energy production efforts, including renewable energy sources.

Additionally, Danskammer is pursuing siting battery storage equipment in the building that presently houses Danskammer’s equipment and operations. Such an installation would allow Danskammer to do even more to provide reliability to the energy grid, deploying stored power when renewable sources like wind and solar might be under-producing.

If Danskammer’s repowering permits are not granted, the facility would continue to operate as it does today, and the space would not be available for battery storage.

Renewable technology is still in its infancy and is not yet capable of handling the majority of the State’s energy needs. Without predictable natural gas options, New York will rely on much dirtier heating oil and out of state coal facilities to provide power for residents. Currently, the State’s wind and solar energy resources produce less than 5% of our baseload energy. It will take years before renewables are supporting a significant amount of New York’s baseload needs. Additionally, resources like solar and wind do not produce energy consistently, 24/7. During times when the sun is not shining or the wind is not blowing, New Yorkers will need reliable, consistent sources of energy.

Until renewable energy can meet 100% of our electricity demands, natural gas is the cleanest, most reliable, and efficient option to ensure New York’s energy needs are met.

No, the Danskammer modernization project is privately funded and will not use taxpayer money, and it will in no way preclude the development of renewable energy resources and infrastructure.

As more renewable energy projects are installed in New York, the fast-start, state-of-the-art equipment at Danskammer will help support renewable energy production by being able to quickly and efficiently fill any gaps in production when the sun is not shining or the wind is not blowing.

The New York Independent System Operator (NYISO) will call upon the most efficient methods of energy production to supply New York’s energy grid, and if renewable energy is available to meet those supply needs, there will not be a need for Danskammer to run.

Danskammer strongly supports job growth in all sectors in the Hudson Valley, including in the renewable energy space. This investment does not in any way preclude a robust green jobs initiative in the Hudson Valley. However, at the current time, there are not many green job opportunities in the Hudson Valley that provide local union workers with good, living wages.

Notably, the Danskammer modernization project will create approximately 450 construction jobs over the course of two-and-a-half years, injecting approximately $200 million into the local economy by way of wages.

The existing Danskammer facility is capable of producing 511 megawatts of electricity. New York relies on it to have that power available when called upon. The 180 acre Danskammer site is not large enough to provide the same or similar power in the Lower Hudson Valley. For example, the portion of the site suitable for solar would only produce between 2 and 3 MWs of electricity. In comparison, the modernized Danskammer facility would be capable of producing 600 MWs after the repowering permits are received. To produce that amount of power through wind or solar would take between 10,000 and 20,000 acres.

Nonetheless, Danskammer is committed to pursuing the installation of battery storage in the existing plant building post-modernization.

Article 10

The modernization of Danskammer is subject to approval by the New York State Board on Electric Generation Siting and the Environment under Article 10 of the Public Service Law. New York is known to have among the most rigorous review processes in the nation. We welcome this level of scrutiny because we believe our modernization proposal stands on its own merits, and that all stakeholders deserve a chance to be heard.

As part of the Article 10 process, we have organized more than 100 meetings, public presentations, and open houses with local and state environmental groups, elected officials and other community groups to share information and answer questions about our proposed project.

Learn more about the Article 10 process.

View the full project timeline, including milestones to date, on the Approval Process page.

As part of the Article 10 process, Danskammer is required to submit a series of independent studies that evaluate the potential environmental, economic and health impacts of the project. These studies are prepared by third party experts and will be subject to review and comment by state agencies and intervenors as part of the Article 10 process.

If the permits for the repowered plant are not approved, Danskammer will continue to operate the existing facility and produce power when called on to do so. It will continue to produce energy for the Lower Hudson Valley using equipment that is many decades old, is cooled using water from the Hudson River, and produces more emissions than modern equipment.

The State’s electric grid operator (NYISO) has indicated that when planned retirements of existing facilities in the region occur, existing facilities like Danskammer will be called upon more frequently to meet the needs of the grid. In its 2019 Power Trends Report NYISO also states that new facilities will only meet 75% of the need created by planned power plant closures. This means that older facilities with much higher emissions will be called upon more frequently to meet the needs of customers. Thus, it is projected that the existing Danskammer facility will run more often regardless of the outcome of the permitting process.

You can contact us directly at [email protected] or 845-428-9473. See additional ways to get in touch with us on our contact page.

The Environment

Danskammer operates off of the same gas that is available in the Lower Hudson Valley for all industrial, residential, heating and power generation purposes, and purchases said gas from Central Hudson.

That system is fed by multiple sources, and it is impossible to scientifically determine exactly where each molecule of natural gas originates. Danskammer draws from the same gas supply that the vast majority of homes and businesses in the area utilize.

The equipment that will be installed in the modernization of Danskammer is much more efficient than what exists today. Put more simply, the new facility would get better “gas mileage” than the existing facility. Therefore, the new plant will use approximately 50% less fuel on a per-megawatt-hour basis that the existing plant uses today.

The amount of fuel that Danskammer uses will depend on how often the facility runs, which is controlled by the New York Independent System Operator (NYISO), the organization that controls New York’s energy grid. With the planned closure of other regional facilities, older plants like Danskammer, which all use significantly more natural gas than newer facilities, will be called upon to run more often. A modernized Danskammer facility means that less gas would be needed to produce this energy, and it would be produced with fewer emissions.

Danskammer runs when called upon by the New York Independent System Operator (NYISO), the organization that controls New York’s energy grid. The State’s electric grid operator (NYISO) has indicated that when planned retirements of existing facilities in the region occur, existing facilities like Danskammer will be called upon more frequently to meet the needs of the grid. In its 2019 Power Trends Report NYISO also states that new facilities will only meet 75% of the need created by planned power plant closures. This means that older facilities with much higher emissions will be called upon more frequently to meet the needs of customers. Thus, it is projected that Danskammer will run more often regardless of the outcome of the permitting process.

A major benefit of the modernization is the fact Danskammer will have quick-start equipment, allowing the plant to power up in as little as one hour, as opposed to the 11 hours it takes today. During that time, the plant is producing emissions, but not electricity. This faster response time is not only more efficient, but allows Danskammer to start up quickly when less predictable wind or solar sources stop working unexpectedly.

The new Danskammer facility will be built farther back from the river and at higher elevations than the existing facility. The proposed new facility is outside of the projected 500-year flood zone, several feet above where the plant currently sits. Every precaution will be taken to protect the facility from flooding and mitigate the impact of any extreme weather events.

Danskammer did not always use natural gas to produce electricity. When the plant opened in 1951, coal was the fuel source for energy production. Oil was added as a fuel source in the 1960s. In the 1970s, during the national oil crisis, equipment was installed to run the facility on natural gas. Danskammer reverted back to coal and oil in the 1980s.

In 2014, Danskammer officially became a natural gas facility. Though the plant’s equipment is capable of using oil as a backup fuel source, there are no plans to return to using oil or coal.

Local Impacts

Danskammer is proud to provide good paying careers to approximately 40 employees who work at the plant, many of whom have been with the company for decades. These employees are engineers, systems operators, and maintenance specialists and they ensure Danskammer runs safely and reliably when called upon to produce energy.

The modernization project will create approximately 450 new construction jobs, with a $200 million payroll over length of the project.

The project is projected to last roughly 2.5 years.

Danskammer is proud to have an agreement with the Hudson Valley Building and Trades Council to use local, union labor for the construction phase. Moreover, Danskammer has partnered with the Hudson Valley Building Trades on a commitment to strive for a diversified workforce that includes women and minorities and offer employment in under-served communities.

The building that presently houses Danskammer’s equipment and operations is well suited to accommodate battery storage, and the company is studying the possibility of a battery project for the old facility.

Such an installation would allow Danskammer to do even more to provide reliability to the energy grid, deploying stored power when renewable sources like wind and solar might not be available.

If Danskammer’s repowering permits are not granted, the facility would continue to operate as it does today, and the space would not be available for battery storage.

The Danskammer modernization is an entirely private investment and will not rely on taxpayer dollars. If Danskammer were to go bankrupt, any losses would be incurred by private investors.

However, if the new facility is not built and the old facility becomes inoperable, there would be an impact to the local community in the form of lost employee wages and tax revenue for the Town of Newburgh, Orange County, and the Marlboro Central School District.

Danskammer is owned and operated by an experienced investor and management team, and there is no reason to anticipate financial difficulties.

No. The modernization project is a $500 million private investment.

Yes, Danskammer currently operates under a Payment In Lieu Of Taxes (PILOT) agreement and would also seek to do so for the new facility as well. Because tax assessments for public utilities is based on construction costs and not property value, such an agreement is necessary in order for the project to be financially viable. Further, a stable, predictable tax payment structure to local governments and schools allows both the company and local governments to do budget planning projections. The company will work closely with the tax jurisdictions to ensure any PILOT agreement has a positive impact on the affected communities. It is projected a modernized Danskammer would have a more than $50 million tax impact over 15-20 years.

About Danskammer

The Newburgh Danskammer facility is Danskammer Energy, LLC’s only asset. The owner, Bill Reid, was born and raised in the Hudson Valley. Reid’s father was a local congressman that represented Westchester County. The management team for Danskammer Energy is made up of five people who have lived or worked in the region for many years.

The staff working at Danskammer all live in the surrounding area, and many are lifelong residents of the Hudson Valley. The CEO and CFO of Danskammer Energy grew up in Westchester and Putnam counties, respectively.

While under previous ownership, Danskammer was sold in 2013 as part of a bankruptcy proceeding. This event did not involve the current owners of the plant. In 2017 the current owners purchased the plant with the idea of modernizing the facility to be cleaner and more efficient as New York works to achieve its renewable targets.