Government Affairs Albany Update - September 14, 2001

Two New York City Power Plants Receive Approval

Con Edison's East River Repowering Project
On August 28th the New York State Board on Electric Generation and the Environment (Siting Board) gave approval to Consolidated Edison for its East River Generating Station, located at 14th Street and Avenue C in Manhattan. The project will add 360 megawatts of electricity to the existing plant.

The approval will allow Con Edison to construct two dual-fuel combustion turbine generators and two heat recovery steam generators at the site. As part of this project, Con Edison has proposed to install this state-of-the-art steam and electric generating equipment inside the East River Generating Station on 14th Street in Manhattan. The project will help insure a reliable steam source for customers that are currently being serviced by the Waterside Generating Station. Once the East River plant is operational Con Ed will retire the existing Waterside generating plant on 38th Street in Manhattan, and remove its three stacks and four boilers, thus eliminating its emissions. The in-service date is scheduled for the late 2002.

KeySpan's Ravenswood Expansion
On September 5th, the Siting Board also gave its approval to KeySpan Energy's Ravenswood expansion project in Long Island City, Queens County. The 250 megawatt, natural gas-fired cogeneration facility will increase the plant's electric-generation capacity by 14%, representing a 3% increase in capacity for the City of New York. The Ravenswood facility currently produces about 1,800 megawatts of electricity. The plant will also transform waste heat into usable, saleable steam. KeySpan estimates the in-service date to be in 2003.

Sale of Indian Point 1 and 2 Nuclear Plants Completed

On August 29th the Public Service Commission approved the sale of Consolidated Edison's Indian Point 1 and 2 nuclear generating facilities, and other related assets, to the Entergy Nuclear Northeast. The approval completes the sale to Entergy of Con Edison's Indian Point 1 and 2 nuclear power plants in Westchester County. Indian Point unit 1 has been shut down and in safe storage since the early 1970s. Indian Point 2 is Entergy's ninth operating nuclear unit, and fourth in the Northeast.

The sale places the two operating units at the Indian Point site under a single owner for the first time in their 25-year operating history. Entergy purchased Indian Point 3 from the New York Power Authority last November.

Entergy paid Con Edison $502 million for the nuclear units, three gas turbines, and other assets. Entergy also paid book value, about $100 million, for nuclear fuel. Under the agreement Con Edison will also transfer to Entergy the $430 million decommissioning trust fund.

The companies also entered into a power purchase agreement for Entergy to sell the output of Indian Point 2 to Con Edison through the end of 2004 at an average price of $39 per megawatt hour. Con Edison will also have a capacity purchase transaction agreement from Entergy to sell the installed capacity of Indian Point 2 to Con Edison through April 2005, with options for capacity purchases for another six years.