Iberdrola Reneges on Promise to Seneca County

March 4, 2010

WATERLOO, N.Y, March 4 /PRNewswire-FirstCall/ — The Seneca County Industrial Development Agency (IDA) has recently learned that New York State Electric & Gas Corp., a subsidiary of Bilbao, Spain-based Iberdrola S.A., is cutting plans for electrical upgrades to the former Seneca Army Depot, turning its back on more than a decade’s worth of work, risking the loss of $2.25 million in grant funding, and jeopardizing future economic growth for Seneca County and the surrounding region.

When Iberdrola acquired NYSEG in 2008, the company made a series of promises to New York State and the state Public Service Commission (PSC) in order to gain the PSC’s approval of the acquisition. One of those promises was to Seneca County. For more than 10 years, the Seneca County IDA worked with Iberdrola’s NYSEG to study the Depot’s electrical needs. As part of that assistance, the IDA helped secure $2.25 million in funding, including a $1.5 million RESTORE-NY grant, to help NYSEG pay for approximately $4.75 million in repairs and capital improvements that would make at least a minimal amount of reliable electricity available at the Depot. These grants may expire as soon as April 1 unless NYSEG shows progress.

“Iberdrola’s NYSEG is not only failing to show progress on this project, they’re now telling us they won’t make any upgrades or install a new transmission line at all,” IDA Executive Director Bob Aronson said. “If they won’t make upgrades or install a new line with 40 percent to 50 percent of the costs covered, then what is the likelihood that they will make improvements when the full $4.75 million is needed? This may be our one and only opportunity to get more electricity to the Depot in the near future.”

As a last resort, the IDA has written the PSC and urged the Commission to consider this situation in any current or near-term decisions as they pertain to Iberdrola.

“Underscoring the legitimacy of our cause, when we copied this letter to our state and federal representatives, each one of them immediately responded with their own letters of support,” Aronson said. “To date, letters supporting the IDA’s request have been sent from U.S. Sens. Chuck Schumer (D-N.Y.) and Kirsten Gillibrand (D-N.Y.), U.S. Rep. Michael Arcuri (D-Utica), New York State Senator Michael Nozzolio (R-Fayette) and State Assembly Minority Leader Brian Kolb (R-Canandaigua).”

“This is a classic ‘chicken and egg’ issue,” Aronson said. “Iberdrola’s NYSEG won’t make upgrades because it says there are not enough businesses at the Depot, but the IDA needs to show there is electric power in order to attract more businesses.”

“We are asking for a minimal amount of reliable power so that any interested businesses can get up and running immediately,” he said. “As it stands right now, we can’t entertain any new users without these upgrades.”

“The Depot desperately needs more electricity,” Aronson added. “We need to make sure Iberdrola lives up to its promises and makes investments in the future of our local economy. The money doesn’t have to come from ratepayers — it can come from the company’s mostly foreign shareholders who are currently receiving substantial dividends from the guaranteed profits made by these regulated utilities.”

Iberdrola recorded a profit of 2.8 billion euros, or approximately $4 billion, in 2009. Additionally, the company has been awarded more than $700 million in U.S. stimulus funding. Total cost of electrical upgrades at the Depot would be $4.75 million, approximately $2.5 million of which would be paid for by Iberdrola.

Community members are encouraged to send letters to PSC Secretary Jaclyn Billing supporting electrical upgrades at the Depot at the following address:

    Honorable Jaclyn Billing
    New York State Public Service Commission
    Empire State Plaza
    Agency Building 3
    Albany, New York 12223

SOURCE Seneca County IDA

Source: newswire

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