The AMP Contract is The Wrong Deal for Cleveland

Submitted by Kevin Cronin on Sun, 02/24/2008 - 21:07.

Cleveland City Council should rescind its involvement in AMP-Ohio's proposed coal-fired utility in southern Ohio. A fifty year commitment to coal is the wrong direction, for Cleveland Public Power (CPP), its customers and the environment. Instead, CPP should develop a comprehensive plan for energy need and energy sources, that includes efforts to reduce demand through conservation, insulation, wind, solar and other alternative sources.

 

Last Friday, The Public Utilities Committee and Chairman Matthew Zone received day-long testimony on the subject. CPP testified that their forecasts for growth say they face an energy shortfall and need to lock in low-cost sources, rather than buy energy on the expensive spot market. CPP also said its price margins are slight, so there is no room to increase prices to reflect higher energy acquisition costs or they risk losing customers. Even so, the CPP answer, a fifty-year deal for a coal-fired utility to be developed by AMP-Ohio, is the wrong answer. Even CPP's own consultant, ION, agrees that this is the "riskiest time" to build a coal-fired plant. To me, risk means several things:

 

  • We can expect more delays and cost increases in plant construction and electricity availability;

  • With all the presidential candidates calling for changes in the utility world (including some form of "cap and trade" system, emissions limitations, additional scrubbers and carbon taxes), coal will not nearly be the cost savings claimed by CPP;

  • The city's coal cost and energy demand estimates (growth rather than the stagnation over the past five years) may be wrong, which changes the whole cost rationale for committing to the AMP plant.

 

There are still too many questions to rush ahead with this fifty year deal:

  • What's the accurate energy demand and what can we do to reduce the demand through conservation and alternative energy? Cleveland has an old housing stock and conservation, can help reduce the demand and ease the energy crunch.

  • Why commit to coal, when the rest of the nation is moving away in response to the greenhouse environmental challenge? According to its own August permit application, the AMP plant would emit 7.3 million tons of carbon dioxide, the leading contributor to global warming, annually.

  • There is too much risk and variation in the coal industry to justify the huge, long-term investment. Change is coming. Cleveland is committing to an energy environment that's going to change and we will be caught stranded, with a higher cost obligations and fewer resources to prepare the future.

  • What is the final price tag for this plant, a cost that will be passed along to us through the prices the city is using to justify our involvement? Costs estimates for the plant has risen dramatically over the past two years.

  • What are the alternatives? Funds for the ION consultancy to review AMP-Ohio could have been used to evaluate energy alternatives. Another energy consultant (Synapse Energy Economics of Massachusetts) recommended that the City, before committing to the AMP Project, should independently evaluate alternative and renewable energy, among others.

 

The AMP-Ohio deal is the wrong direction for Cleveland.

Corporate lobbied "democracy" - always does the worse/wrong deal

 Back in 2008 the City of Cleveland City Council approved owning a big % of the AMO Ohio 50 year contract to build the Meigs plant.   Probably the stupidist thing that the Council could do, they did.  Kevin Cronin was there.  He saw it happen.

Ironically, the only thing that saved The City of Cleveland's ass from their own bankrupting stupidity was the fact that the AMP Ohio deal was financed by Lehman Brothers - who went bankrupt first

This week (2014) the US Supreme Court (scotus) put another nail in coals' coffin lid.

So, as it turns out, if Lehman Brothers hadn't gone bankrupt and saved Cleveland's ass, the Supreme Court decison would have very negatively affected the value of Cleveland's investment in the 1000MW AMP Ohio coal fired plant which was proposed for the Ohio River.

The point here is that as I look back 10, 20, 30 years on the decisions that corporate driven "democratic" municipal (especially) and federal governments make, I am being forced to accept the fact that our legislators almost always make the WORST possible decision

AMP-Ohio is just one example.   

Let's next look at landfills and where they have been allowed by our local governments to be placed - usually right next to our water supplies -