Sen. Charles Schumer's heart is in the right place.
He knows how important the NRG Dunkirk electric generating station is as the largest taxpayer in Chautauqua County. The city of Dunkirk and Dunkirk City School district are particularly reliant on NRG's yearly multi-million dollar payments in lieu of taxes.
However, it was a bit much for Schumer to ask the company last week to exceed its agreed upon tax payments. The senator wants NRG to continue paying on generating units in Dunkirk the company is asking to mothball for now.
An economic slowdown and lack of transmission capacity between here and downstate have reduced demand for the plant's electricity. Even more, natural gas is a cheaper fuel to use right now, making NRG's coal-fired plant in Dunkirk even more unprofitable, at least right now.
As you know, NRG has filed a notice with the state to shut down - temporarily they hope - the Dunkirk plant, which, with a generating capacity of 535 megawatts, is one of the state's bigger power plants. The state Public Service Commission has until the end of summer to decide whether the electric grid can get along without the NRG power.
If the PSC finds the electricity is needed to make the power grid reliable, then an electric utility that sells power here will be required to buy NRG's more expensive power under a "reliability contract." Having that contract would enable NRG to keep operating and, thus, keep paying taxes.
Schumer contends NRG wants to shut down the Dunkirk plant just to avoid paying its taxes - $16.6 million over the next two years. He said that eventually demand for electricity from the modernized plant in Dunkirk will increase as older plants elsewhere close down and it will become profitable. Meanwhile, he said, NRG should be a good neighbor and keep making those tax payments no matter what.
Clearly local governments will be in a bind if the NRG plant closes and the payments stop. But NRG is not a charitable foundation. It is a business with obligations to its stockholders. NRG has been soldiering along making its agreed-upon tax payments while losing money on its Dunkirk plant for the past three years. It is simply unrealistic to think that can go on.
It seems to us Sen. Schumer would serve his constituents much more effectively by demanding that his cohorts and the president come up with a clear, non-partisan and economically sustainable federal energy policy that enables power producers to know the technologies they can invest in today without finding themselves with an unusable albatross a few years later.
Power producers - and the whole country - would benefit from policies that balance environmental concerns with electric reliability and reasonable costs, while still enabling private power companies to make a profit.
Sen. Schumer's heart is in the right place. NRG, and the Chautauqua County residents who rely on the power plant, need Schumer's mind in the right place too.