There had been an ongoing legal squabble in Trumbull County, OH over a proposed Utica gas-fired electric plant in Lordstown, located next door to another gas-fired plant (see Squabbling Over 2nd Lordstown Utica-Fired Elec Plant Near an End). The squabbling ended Friday when the two sides agreed to settle their differences.
The good news is that the second Lordstown plant will begin construction in 2019.
Clean Energy Future (CEF) built the Lordstown Energy Center which went online in October 2018 (see Lordstown (OH) Energy Center Now Online, Generating 940 MW). CEF proposed, and got the Ohio Power Siting Board (OPSB) to approve, plans to build a second Utica-fired plant next door to the first, called the Trumbull Energy Center (see Ohio Approves 2 Utica-Fired Power Plants in Guernsey, Trumbull Counties).
As typically happens, CEF (the builder) sold most of the first project (Lordstown Energy Center) to investors. In this case the new majority owner for the first plant is Macquarie, an international investment firm. CEF sued Macquarie in September 2017 saying Macquarie was preventing CEF from building the second plant.
Macquarie says if a second plant gets built in the same location, the first plant (now owned by Macquarie) will take a $6.7 million hit on earnings each year. Macquarie wants CEF to pay them that amount annually when/if the second plant gets built. To which CEF says, “They’re looking for an extortion payment.”
Trumbull County Court ruled in favor of CEF, instructing Macquarie to sign paperwork allowing the second plant to get built, and to sell property owned by the first plant to the second plant (as provided for under the original contract). Macquarie refused continued to sell the land, even though ordered to by the court.
CEF asked the court to find Macquarie in contempt and make them sell. CEF also sued Macquarie for $130 million for delaying the second project for more than a year.
It was into that legal mess both sides were forced into mediation last September. On Friday both sides agreed to a final settlement:
Six months of mediation in a 2017 lawsuit has resolved a dispute between the owners of the Lordstown Energy Center in Lordstown Industrial Park and the developer of a proposed second $900 million power plant next door.
The agreement, worked out with the help of Magistrate Anthony Cornicelli of Trumbull County Common Pleas Court, will help facilitate the construction of a second power plant in the village.
Bill Siderewicz, president of Boston-based Clean Energy Future, developer of both natural-gas-fired plants, said Friday he is concerned, however, about remarks from Ohio Speaker of the House Larry Householder and Gov. Mike DeWine that the public “should bail out two antiquated nuclear plants to the tune of $100 million [per] year.”
He said that move “would endanger the current, very free power-generation market in Ohio that would allow Trumbull to proceed.”
Siderewicz called Householder’s and DeWine’s comments possible “roadblocks,” and it would “throw a proverbial monkey wrench in Ohio’s private investment electricity-generation market,” of which the Trumbull Energy Center would be part.
Siderewicz has said in the past the two Lordstown plants would each employ about 19 permanent workers and about 900 people during construction.
The first plant began operation last October after about 2 1/2 years of construction.
Siderewicz and his company filed the lawsuit on behalf of the proposed second plant, known as the Trumbull Energy Center, in September 2017 asking Judge Peter Kontos to enforce the agreements the owners of the first plant signed to allow the second plant to be built.
The owners of the first plant, known as the Lordstown Energy Center, said they were holding off on deciding whether to allow the second plant’s construction until they had time to study the impact the second plant would have on the first plant.
Judge Kontos ruled in late 2017 that the owners of the first plant must sign an agreement related to the industrial park necessary for the second plant to proceed. An appeal of that ruling is pending.
The document the owners of the first plant were not willing to sign was a change to the industrial park’s restrictions, which the parties in the park approved earlier to allow the first power plant to be built.
Judge Kontos ordered the parties into mediation with Cornicelli last September.
The Ohio Power Siting Board in Columbus on Oct. 4, 2017, gave permission for the second plant to be constructed.
The first plant generates 800 megawatts of electricity, while the second one is expected to produce 940 megawatts, according to documents associated with the siting board. (1)
CEF issued a press release (which we can’t locate online), to announce that the Trumbull Energy Center will break ground this summer. The Youngstown Vindicator carried the news today:
Construction of a $925 million clean-energy power plant in Lordstown should begin this summer, according to a press release issued today from Clean Energy Future, the project’s developer.
The center is projected to have a $26 billion long-term economic impact on the Mahoning Valley economy and local and state governments, according to CEF.
Trumbull Energy Center will be built adjacent to and just south of the $900 million Lordstown Energy Center, which CEF also developed. It went into commercial operation last October.
Huntington Bank and Key Bank have both expressed interest in loaning debt capital to Trumbull, according to the press release issued by Bill Siderewicz, CEF’s president.
Trumbull has all its major permits and licenses, and CEF was ready to proceed to the financing stage for Trumbull when a contract dispute arose that forced Trumbull to file suit against the adjacent Lordstown energy facility. That dispute has been settled, officials said.
“Once funded, Trumbull will yield substantial economic benefits to Northeast Ohio and the to the people of Trumbull and Mahoning counties,” said Bill Siderewicz, CEF’s president.
Trumbull will be a huge economic boost to the Mahoning Valley and greater-Ohio, he said.
The immediate impact will be new construction jobs over 34 consecutive months that will peak at 950 workers, representing close to 2 million man-hours of construction effort, CEF said.
The Village of Lordstown will benefit from, among other things, salary tax revenues, property tax payments, village income tax payments and a water service fee. Over the first 50-year life of Trumbull, the village is projected to receive over $247 million from these four sources of funds from Trumbull, Siderewicz said.
“When one examines the other positive economic benefits to the Mahoning Valley, Northeast Ohio and state and local governments, Trumbull is projected to have a $26 billion impact … all without the need for funding from local or county government, Columbus or Washington, D.C.,” he said.
“The only storm clouds on the Trumbull horizon could originate from Republican political leaders in Columbus,” said Siderewicz.
“There are newspaper articles and Twitter messages suggesting that certain political leaders support sustaining bankrupt nuclear plants. Such support would seek to create a new law that would force Ohioans to “bail out” privately-owned uneconomical nuclear plants in Ohio,” he said.
“The primary reason why Lordstown was built and Trumbull is planned, and why over $8 billion of private capital is invested in similar plants across Ohio, is the belief that Ohio’s electricity generation market will remain free and open, as it has been since 2000. Any politically forced bailout plan, or other artificial manipulation of a free Ohio electricity generation market by the Legislature, would taint the Ohio market place and chase free enterprise away,” he said.
Also, preserving old nuclear plants can only happen by first burdening the public with $100’s of millions per year in unwanted and unnecessary bailout payments. Such a massive bailout would be piled on top of the backs of Ohioans who already face a possible new unpopular 18 cents per gallon gasoline tax, CEF release said.
Ohio is in a unique and envious position in the United States, in that North and Northeast parts of Ohio are situated over the Appalachian Basin, the third-largest gas supply in the world, which allows natural gas to be produced at the lowest cost in the world, it added.
“Ohio is in position to be an energy leader for decades to come. The state’s economical energy will become a magnet for new business and companies looking to better their competitiveness via low cost natural gas and electricity.
“We hope political leaders see this very real logic and they move Ohio ahead in 2019, not backwards into an antiquated setting of public bailouts, corporate handouts and/or subsidies.
“We are excited to again be working with the Village of Lordstown, the City of Warren and all of out Valley friends and neighbors to make Trumbull a glowing success for all, as well as a good neighbor.
“CEF looks to plan an active and visible role in Trumbull’s community activities, that include cooperative educational programs with Lordstown and Warren G. Harding high schools, Kent State and Youngstown State universities.
“Trumbull will be a real-word hub of science and technology in action, and represents an important forum to enhance the educational and learning experience for our youth who will ultimately become the future leaders of the valley,” said Siderewicz.
The plans for the Trumbull Energy Center are expected to be detailed at 1 p.m. press conference today in Lordstown. (2)
(1) Youngstown (OH) The Vindicator (Feb 23, 2019) – Mediation resolves dispute over 2nd Lordstown power plant
(2) Youngstown (OH) The Vindicator (Feb 25, 2019) – Trumbull Energy Center plans revealed; groundbreaking set for summer
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