US city looks to close loss-making gas CHP facility

City officials in Auburn, in New York state plan to shut down a landfill gas-cogeneration facility that has caused estimated losses of $3.9m.

Revenues have fallen well short of operational costs and debt service payments, lawmakers could officially pull the plug on the operation as soon as next week, after five years of operation.à‚ 

Members of the Auburn City Council will likely vote on the action next week, said Interim City Manager Jeff Dygert.
Auburnpub website stated that since 2011, operational losses for the cogeneration facility have ranged as high as around $1.05à‚ million, with a cumulative deficit of more than $3.7 million. Including debt service payments, the total financial loss over those five years amounted to around $3.9 million, according to a report prepared by Comptroller Laura Wills.

Officials have sought alternative avenues for relief. These included selling energy on the New England market or creating a city position to manage the facility as opposed to contracting those servicesà‚ at a $240,000 annual cost to third-party company Aria Energy.

Councilors were presented Thursday with two options to decide the cogen’s future: Close the facility or lease it. Closing it would involveà‚ using the building for sewer equipment storage, exercising the engines regularly and terminating the Aria contract, among other stipulations.

Leasing wouldà‚ require the city to maintain the facility in the search for a lessee and make payments on contractual costs incurred while the facility is idle, according to the comptroller.

In the end, councillors unanimously supported the option to shut down the plant. A greater majority of councilors agreed they would not consider the idea of leasing it out at this point.

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