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November 14, 2005

Council urges DEC to finalize permit allowing assessment of alternative energy source

The state Department of Environmental Conservation (DEC) should finalize a draft permit that would allow one Upstate employer to assess the use of an alternative energy source that could save jobs, The Business Council told the DEC in testimony on November 9.

The DEC has issued a draft permit which would permit International Paper to test burn shredded tires at its Ticonderoga plant, Ken Pokalsky, director of the Council’s environmental and regulatory programs, testified at the DEC hearing. The decision to finalize the draft should be “a fairly easy” decision for the DEC to make.

“The draft permit amendment authorizes a limited use of tire-derived fuel, for a limited time period, under strict regulatory requirements and extensive agency oversight,” Pokalsky said.

Despite claims by some opponents, the permit would not reduce or compromise existing environmental standards during the testing period, Pokalsky said. “The two-week trial will be completed in compliance with all applicable laws, regulations and standards.”

Any decision regarding a permit amendment to authorize long-term use of the tire-derived fuel, or to require significant additional investments in emission controls, will be based on extensive analysis of the technical data derived from the trial burn, Pokalsky said. These are the primary factors on which the department’s final decision on the draft permit should be based.

In addition to the fact that the trial period would not compromise existing environmental regulations, the project is an important one for the long-term viability of the Ticonderoga plant and the retention of the 660 jobs it provides, Pokalsky said.

“Further, more than 1,000 additional jobs, from loggers and truckers, to jobs in local retail and service industries, are directly or indirectly dependent upon the plant,” he said. “In economic terms, manufacturing has a significant multiplier effect. The Empire State Development Corporation has done research showing that about 50 percent of all private sector employment in upstate New York is directly or indirectly dependent on manufacturing.”

In addition, the average Upstate manufacturing job pays about $11,000 more per year than the typical non-manufacturing, non-governmental job, Pokalsky said. “Our in-house research shows the difference to be even greater in the Adirondack region – about $17,500, in part due to the impact of International Paper’s employment. Those jobs are among the best in the North Country – and would be difficult if not impossible to replace in any reasonable time frame.”

Over the past five years, New York has lost more than 117,000 jobs, according to the Bureau of Labor Statistics.

“Retention of manufacturing and manufacturing jobs must be given higher priority in both New York and Vermont, and the impact of this project on the economic well being of the Ticonderoga region should be an important factor in this permit decision,” Pokalsky said.

“New York needs to take immediate steps to offset rapidly rising energy costs,” Pokalsky said. “The rising cost of petroleum is affecting businesses nation-wide, and is an issue in IP’s effort to identify alternative energy sources. The high cost of electric power is an especially acute problem in New York, where average per kilowatt hour costs for most industrial customers is significantly above the national average.”

The Ticonderoga plan is one of the company’s highest-cost mills, taking into account New York’s relatively high costs of energy, workers’ comp, property taxes and other costs, Pokalsky said. “It is absolutely critical that International Paper aggressively reduce production costs in order to remain competitive.”

International Paper said the use of tire-burning as an alternative fuel could save the plant up to $3 million per year.