PEAK Coalition Dirty Energy, Big Money: Rationale and Feasibility

Update June 30, 2020:  I wrote a layman’s summary on this issue here.

New York State energy and environmental policy is more about optics than results.  Nowhere is this more apparent than the recent spate of opinion pieces, reports, and even policy proposals related to peaking power plants.  In May 2020, the PEAK Coalition released a report entitled: “Dirty Energy, Big Money”.  The focus of the study is the “peaker” power plants that operate when energy demand in New York City spikes above normal levels.  Because I have been involved with this issue and these plants for over 20 years, I want to review the report.

This is my second post on this topic.  The first post provided information on the primary air quality problem associated with these facilities, the organizations behind the report, the State’s response to date, the underlying issue of environmental justice and address the motivation for the analysis.  This post addresses the rationale and feasibility of the proposed plan relative to environmental effects, affordability, and reliability.

I am a retired electric utility meteorologist with nearly 40 years-experience analyzing the effects of meteorology on electric operations.  I have been involved with the peaking power plants in particular for over 20 years both from a compliance reporting standpoint and also evaluation of impacts and options for these sources.  This background served me well preparing this post.  The opinions expressed in this post do not reflect the position of any of my previous employers or any other company I have been associated with, these comments are mine alone.


The Physicians, Scientists, and Engineers (PSE) for Healthy Energy is a multidisciplinary, nonprofit research institute that studies the way energy production and use impact public health and the environment. Their report Opportunities for Replacing Peaker Plants with Energy Storage in New York State formed much of the technical basis for this PEAK Coalition analysis.   I discuss that report here.

The full title of Dirty Energy, Big Money includes: “How Private Companies Make Billions from Polluting Fossil Fuel Peaker Plants in New York City’s Environmental Justice Communities—and How to Create a Cleaner, More Just Alternative Public Health Impacts”.  The table of contents includes sections on public health impacts, New York’s reliability process and payments, clean energy alternatives and the benefits of the PEAK Coalition proposed alternative.  I will address each of these topics.

The report has a table of Peaker Power Plants Operating in New York City which is based on a Physicians, Scientists, and Engineers for Healthy Energy report: Opportunities for Replacing Peaker Plants with Energy Storage in New York State.  The peaking units included in that report cover not only small combustion turbines with nameplate capacities down to 16 MW but also steam turbine boilers such as Ravenswood ST03 with a nameplate capacity of 1,027 MW.  The problem with using that overview analysis in this instance is that the impacts and alternatives for such widely different power plants are completely different.   Unfortunately, the report does not address the differences and suffers as a result.

Public Health Impacts

The PEAK coalition description of air quality public health impacts claims that “When New York’s gas-fired peaker plants are operating, they can account for over one-third of New York’s daily power plant NOx emissions,” but the citation is from a press release so I could not track down the basis for that claim.  This is one example of the problem resulting from the broad definition of peaker plants that considers both steam turbine boilers and combustion turbines.  Because steam turbine boilers have relatively tall stacks and hot plumes there are very few direct impacts on local neighborhoods from their emissions simply because there is no opportunity for the plume to reach the ground so close.  The press release is apparently referring to the older simple cycle combustion turbines that either have to retire or install controls by May 1, 2023.  More importantly, the discussion of health impacts focuses on PM2.5 (particulate matter with a diameter of 2.5 microns or less that is small enough to be inhaled deep into the lung) and ozone.  Neither of those pollutants is associated with local impacts from natural gas and oil-fired power plants because they are primarily a result of secondary pollutant effects meaning that they result from reactions with other directly emitted pollutants.  Those reactions take time and by the time they occur the air mass has moved away from the local neighborhoods.

The primary public health reference was the New York City Department of Health and Mental Hygiene’s (DOHMH) Air Pollution and the Health of New Yorkers report.  The PEAK Coalition quotes the conclusion from that report: “each year, PM2.5 pollution in [New York City] causes more than 3,000 deaths, 2,000 hospital admissions for lung and heart conditions, and approximately 6,000 emergency department visits for asthma in children and adults.”  Each year they claim exposures to ozone concentrations above background levels cause an estimated “400 premature deaths, 850 hospitalizations for asthma and 4,500 emergency department visits for asthma.”  What is not made clear is that these conclusions are for total air pollution in NYC and are based on air quality conditions from 2005-2007.

The DOHMOH report describes PM2.5 and its sources:

Fine Particles (PM2.5) are small, airborne particles with a diameter of 2.5 micrometers or less. Major sources of PM2.5 include on-road vehicles (trucks, buses and cars); fossil fuel combustion for generating electric power and heating residential and commercial buildings; off-road vehicles (such as construction equipment); and commercial cooking (U.S. Environmental Protection Agency, National Emissions Inventory). Fine particles can also become airborne from mechanical processes such as construction or demolition, industrial metal fabrication, or when traffic or wind stirs up road dust.

An article entitled Fine Particulate Matter Constituents Associated with Cardiovascular Hospitalizations and Mortality in New York City by Ito et al., 2011 concludes that “Local combustion sources, including traffic and residual oil burning, may play a year round role in the associations between air pollution and cardiovascular disease outcomes, but transported aerosols may explain the seasonal variation in associations shown by PM2.5 mass”.  Residual oil burning at the PEAK coalition peaker power plants is a backup fuel source used when there is a scarcity of natural gas or there are transmission constraint requirements that require a minimum oil burn.  Because of the fuel use characteristics, the tall stacks, and the conversion time between SO2 emissions and sulfate aerosols it is unlikely that these power plants have neighborhood impacts.  It is more likely that traffic sources are a larger contributor to EJ communities near the power plants.

There is one more aspect of the DOHMOH PM2.5 report that needs to be addressed.  The report specified four scenarios for comparisons (DOHMOH Figure 4) and calculated health events that it attributed to citywide PM2.5 (DOHMOH Table 5).  Based on their results the report notes that:

Even a feasible, modest reduction (10%) in PM2.5 concentrations could prevent more than 300 premature deaths, 200 hospital admissions and 600 emergency department visits. Achieving the PlaNYC goal of “cleanest air of any big city” would result in even more substantial public health benefits.

It is important to note how the air quality has improved since the time of this analysis.  The NYS DEC air quality monitoring system has operated a PM2.5 monitor at the Botanical Garden in New York city since 1999 so I compared the data from that site for the same period as this analysis relative to today (Data from Figure 4. Baseline annual average PM2.5 levels in New York City). The Botanical Garden site had an annual average PM2.5 level of 13 ug/m3 for the same period as the report’s 13.9 ug/m3 “current conditions” city-wide average (my estimate based on their graph).  The important thing to note is that the latest available average (2016-2018) for a comparable three-year average at the Botanical Garden is 8.1 ug/m3 which represents a 38% decrease which is substantially lower than the PlaNYC goal of “cleanest air of any big city”.

The DOHMOH analysis used a linear no-threshold health impact analysis.  As a result, it is possible to estimate the air quality health effects of the observed decrease in PM2.5 using their model (Modified Table 5. Annual health events attributable to citywide PM2 5 level).  Note that in DOHMOH Table 5 the annual health events for the 10% reduction and “cleanest” city scenarios are shown as changes not as the total number of events listed for the current levels.  My modified table converts those estimates to totals so that the numbers are directly comparable.  I excluded the confidence interval information because I don’t know how it would be modified.  I tested the linear hypothesis by scaling the “current level” scenario number of events to the proportion of the PM 2.5 concentrations for the “current level” and the other two scenarios.  My estimated health impacts were all within 1% which demonstrates that is all the DOHMOH analysis did.  Therefore, I could estimate the health impact improvements due to the observed reductions in PM2.5 as shown in my modified table.

I do not believe that the linear no-threshold air quality health impact model is correct.  I could be convinced, however, if the DOHMOH could demonstrate that the observed health impacts improved as predicted by the model.  Until such time as someone validates the performance of this kind of model I recommend caution in these results.

The DOHMOH report also describes ozone:

Ozone is not emitted directly from fuel combustion; it is produced by chemical reactions involving nitrogen oxides (NOx)—a mixture including nitric oxide (NO) and nitrogen dioxide (NO2)—volatile organic compounds and sunlight. O3 concentrations typically peak in the afternoon and are highest in the summer, when daylight hours are long and temperatures are high. Although NOx emissions from vehicles contribute to higher ozone in urban areas, in city locations where fresh NOx emissions are concentrated, NO reacts with, and removes, ozone from the atmosphere in a reaction known as ozone “scavenging.” As a result, concentrations in urban areas with an abundance of NOx from traffic sources tend to have somewhat lower concentrations of ozone than more suburban locations downwind from the city center.

For the purposes of this evaluation of localized neighborhood impacts from the peaker plants note two things.  Because ozone is a secondary pollutant the emissions from the peaker plants do not create ozone that affects neighbors.  The reason the DEC put controls on the peaking turbines last year was because of their impact on ozone levels downwind in Connecticut.  Moreover, as the DOHMOH report explains if there is any effect of these power plants on the neighborhoods it would be a reduction in ozone because of “scavenging”.

New York’s Reliability Process and Payments

The description of New York’s energy reliability process provides a good overview and appropriately stresses the importance of reliable energy to prevent blackouts and brownouts.  It describes the process which determines the energy mandates, procurement process and specifies energy needed for peak energy demand.  Despite apparently understanding the process and the importance of having power available for peak demands, the capacity market is vilified as unwarranted “big money”.  The de-regulated market needs a mechanism to pay the power plant owners for their services.  If the load did not vary diurnally, seasonally, and was not subject to high energy demands, payments would be simple.

However, because it is not simple, the market mechanism includes both payments for electricity provided but also for capacity.  The report states “This means that all peaker plants in New York City collect millions of dollars every year just to be “on standby” to produce very little energy —sometimes for only a few days each year.”  That is true but it neglects the obvious point that if they were not available for those few days each year there would not be enough energy and brownouts and blackouts would be the result.

I do not dispute that there is a New York City peaker problem where old, inefficient combustion turbines are being used to provide critically needed power when needed most. In order to force their replacement the New York State Department of Environmental Conservation promulgated new  limits for the simple cycle turbines such that they will be required to install controls or shut down. The compliance date for that regulation is May 2023 and the state may grant a two-year compliance extension to peaker plants deemed a “reliability resource by the NYISO or transmission owner”.

In my opinion the New York City peaker problem is the result of New York’s de-regulated market place.  I am absolutely sure that in a regulated environment the responsible utility would have made a case to the Department of Public Service that replacement with more efficient generation was needed and after it was approved the utility would have been guaranteed a reasonable return on their investment.  However, in the de-regulated market there wasn’t a strong enough signal to replace the old units.  Before I retired in 2010, I worked on two separate permit applications for new efficient and cleaner replacement power for one set of the old combustion turbines.  In both instances the permits were approved but the replacements were never built, apparently because the company decided that the business case was not strong enough to warrant the investment.

The PEAK Coalition apparently believes that there are problems with payments for the existing generators.  I have neither the background or time to evaluate those claims in detail so I cannot comment on them.  The fact that there has been a lot of turnover in ownership for New York’s peaking units suggests that no one is making great profits under the existing system.  Moreover, it should be kept in mind that in the de-regulated market, generation owners have no obligation to serve.  If they cannot make money they will just shut down.

Clean Energy Alternatives

This report proposes replacing peaker plants with “renewable and clean energy alternatives”.  It states:

However, solar and wind power alone cannot replace peaker plants, because the power they produce cannot be dispatched on command, and they have limitations on when they generate energy (e.g., solar photovoltaic (PV) systems can only generate optimal energy amounts on sunny days). For this reason, wind and solar energy systems are known as variable renewable energy sources. Combining battery storage technologies with renewables can address this limitation. Replacing peaker plants with batteries has now become a viable and profitable solution, due to the rapidly declining cost of energy storage systems.  Ideally, the batteries replacing peaker plants would be charged with local, renewable energy resources.

The motivation for the PSE peaker project that provides the technical basis of this report appears to support the use of batteries as a clean energy alternative to fossil-fired power plants.  By motivation I mean the likely source of funding for their analysis.  As a result, it is no surprise that batteries are touted as the solution.  Unfortunately, the PEAK coalition report fails to temper the enthusiasm of the battery “solution”.  Statements such as “Experts have found—and real-world examples have proven—that battery storage and renewable generation may be less expensive to develop and manage than the rarely used but heavily polluting fossil fuel power plants, while also meeting or exceeding the same performance standards” are suspect at best.

For example, I will consider options to build new generation to replace the energy produced at the Astoria Gas Turbine, Gowanus Generating Station, and Narrows Generating Station peaking plants on a typical high-load day – June 18, 2018.  All three plants operate simple-cycle combustion turbines that can burn natural gas or kerosene. All three facilities are on the order of 50 years old and, in my opinion, should be replaced.

The peak hourly load in this example was 752 MW so I used US Energy Information Administration (EIA) construction cost data for electric generators installed in 2017 information to estimate costs.  The report provides $/kW estimates for different technologies, locations and configurations.  I estimated the cost of a new combined cycle power plant similar to the one proposed to re-power Gowanus and Narrows and what was proposed for the two permit applications for re-powering the Astoria gas turbine facility.  According to EIA the average construction cost ($/kilowatt of installed nameplate capacity) of a combined cycle unit was $829 so a replacement facility would cost $674 million.  The average construction cost ($/kilowatt of installed nameplate capacity) of a utility-scale solar PV facility using crystalline silicon, axis-based tracking panels is $2,135 so a replacement facility would cost $1,606 million or nearly twice as much.   The average construction cost ($/kilowatt of installed nameplate capacity) of a land-based wind turbine facility (plant size 200-500 MW) is $1,526 so a replacement facility would cost $1,148 million.  It is often said that renewable energy is cheaper than fossil-fired energy but these numbers from 2017 clearly are refute that presumption.

The bigger problem, and one that should always be kept in mind that even if the cost of a solar and wind are equal to or a little less than the cost of a new fossil-fired plant, renewable energy is not dispatchable.  In this example I will only address the storage needed to handle the output for the existing peaking turbines but because renewable energy is diffuse transmission lines are needed.  Fossil-fired units provide grid support services but solar and wind generators do not.  Those support services are not considered in this example.

My interpretation of the PSE proposed alternative and the PEAK Coalition plan is to rely on energy storage to replace the output of the existing combustion turbines.  The Calculated Cost Breakdown for a U.S. Li-ion Standalone Storage System for June 18 2018 Example Peak provides the information necessary to estimate the energy storage batteries necessary to replace the turbines as well as the estimated battery requirements.  I simply estimated battery configurations needed by picking a capacity to cover the minimum needed for as long a period as possible and then repeated the process until the storage capacity met the observed load.  For example, at Astoria there were six hours of load and a battery with 280 MW capacity operating for six hours combined with a battery with 200 MW operating for one hour could completely cover the generation at that facility.  This simplistic approach also does not include energy losses due to charging and discharging.

I relied on two National Renewable Energy Lab (NREL) reports to estimate the costs of energy storage: “2018 U.S. Utility-Scale Photovoltaics-Plus-Energy Storage System Cost Benchmark” and “Life Prediction Model for Grid-Connected Li-ion Battery Energy Storage System”.  I estimated the parameters used by NREL to project costs so that I could calculate the cost of any battery configuration.  Keep in mind that I did not try to optimize battery resources in any way so these should be considered first-cut estimates.  I estimate that $1,797 million of Li-Ion batteries would be required to replace the power assuming that the battery capacity equals the observed generation.

It turns out that assumption is wrong because the second NREL report abstract notes that “The lifetime of these batteries will vary depending on their thermal environment and how they are charged and discharged. Optimal utilization of a battery over its lifetime requires characterization of its performance degradation under different storage and cycling conditions.”   The report concludes: “Without active thermal management, 7 years lifetime is possible provided the battery is cycled within a restricted 47% DOD operating range. With active thermal management, 10 years lifetime is possible provided the battery is cycled within a restricted 54% operating range.”  Because of the high cost of the batteries I assume that it would be best to extend the lifetime as much as possible.  When the 54% operating range constraint is added, more batteries are required and cost to replace the power produced by these three peaking plants on June 18, 2018 would be $3,651 million.  One other thing needs to be pointed out. If we assume that the life expectancy of the combustion turbines, solar arrays and wind turbines is 30 years that means that the battery storage for the renewable power would have to be replaced twice over the lifetime of the facilities.

Furthermore, the energy storage estimates in this example have no real-world counter parts.  According to the Hornsdale Power Reserve website “At 100MW/129MWh, the Hornsdale Power Reserve is the largest lithium-ion battery in the world, and provides network security services to South Australian electricity consumers in concert with the South Australian Government and the Australian Energy Market Operator (AEMO)”.  According to the PEAK coalition report “In October 2019, the New York Public Service Commission (PSC) approved the development of a 316-MW, 8-hour-duration battery at the Ravenswood Generating Station in Long Island City”.

Dirty Energy, Big Money states “Experts have found—and real-world examples have proven—that battery storage and renewable generation may be less expensive to develop and manage than the rarely used but heavily polluting fossil fuel power plants, while also meeting or exceeding the same performance standards”.  This statement is just plain wrong.  As soon as energy storage is added to the renewable “solution” the projected costs rise exponentially and there are no real-world examples for policy decisions.

Benefits of the PEAK Coalition Proposed Alternative

The report claims that “Replacing peaker plants with renewable energy and battery storage, if done right, brings a host of benefits in addition to efficient, clean, dispatchable electricity.”  The report does not explain how a “done right” replacement with renewable energy and battery storage could be accomplished.  For example, there is no apparent recognition that the NYISO currently requires that at least 80% of New York City’s electric generating capacity needs be met through in‐City generation. My impression is that the presumption is that the PEAK Coalition believes that solar can be used in the city.  However, I think the space requirements make that unlikely.  For ten Article Ten solar energy applications currently in the queue, 5.4 acres per MW was the lowest spatial requirement.  For my example of 752 MW of peaking power, 602 MW would have to be produced in the city and at 5.4 acres per MW that means that there would have to be five square miles of solar panels.  I am sure that there are no open areas that size so the panels will have to be installed on buildings.  That would add to the costs substantially.

The lack of any kind of plan is not the only issue with proposed alternative.  The benefits listed are as superficial and innumerate.  Consider the discussion on resiliency per: “A transition toward renewable energy and energy storage technologies can provide energy resiliency, backup power, and other benefits at the local level”.  I do not consider an energy system resilient when it is unavailable half the time like solar or is subject to the vagaries of weather like the wind.  The current emphasis is on the summer peak but New York’s aspirational climate targets will require electrification of heating a necessity which means the winter peak will become much more of an issue.  As a result, the worst-case load situation may not be the annual peak peak but could be a combination of high load and low renewable energy inputs.  That is not the sign of a resilient system.  It gets worse when the report states “Resiliency planning is particularly important for critical facilities throughout the five boroughs, including hospitals, evacuation centers, cooling centers, and food distributions hubs” and gives an example of a solar array on a school that serves as an evacuation center during emergencies.  If the facility is critical then redundant energy supplies not based on intermittent renewables are needed.  If there is an ice storm and the power lines go down then what?  The obvious, but politically incorrect solution, is to have a natural gas fired turbine generate the power needed by the micro-grid.

Another benefit claimed is reduced air pollution and resulting health improvements.  The report states “Using renewable energy to charge batteries eliminates greenhouse gas emissions. Statewide, it is estimated that adding 1,500 MW of energy storage would avoid one million tons of CO2 emissions”.  In order to get the one million ton reduction the addition of 1,500 MW would have to displace the large steam boilers PSE includes in their peaker category.  Those are not candidates for battery storage replacement.   The report claims: “With over 1.2 million New Yorkers living within a one-mile radius of a fossil fuel peaker plant, the reduction of air pollutants from peaker plants would have a significant impact on the health and quality of life of people living in the five boroughs of New York City”.  As previously explained in this post, that claim is very unlikely to be true.

Another benefit claimed would address the energy burden on under-resourced communities.  The report explains that energy poverty is a serious issue in New York City and goes on to claim that a significant portion of utility bills is directly related to payments for the “outdated fossil fuel peaker plants”.  I do not understand how environmental and social justice organizations can support the idea that the renewable and energy storage transition will lead to lower costs when every jurisdiction that has tried to implement those resources has seen marked increases in prices.  I am convinced that New York’s climate aspirations will result in much higher prices and the communities that these organizations purport to serve will be impacted the most.

The final benefit claimed is that the proposed transition will mean that “Instead of capacity payments going to private hedge funds or equity firms that own fossil fuel peaker plants, billions of dollars in ratepayer funds could instead be used to invest locally in publicly-owned and community-owned, distributed renewable and battery storage alternatives in New York City.”  The numbers shown in this report suggest that the transition will be far more expensive that investing in a natural-gas fired combined cycle power plant.  According to EIA the power plant that could provide the energy produced by three old peaking power facilities on June 18, 2018 would cost $674 million and would last at least 30 years.  If in-city solar were built it would cost $1,606 million and could also last 30 years.  The fatal flaw in the economic argument is the need for energy storage.  I estimate that, based on NREL estimates, energy storage would cost $3,651 but would only last ten years.  It is very unlikely that energy storage can come down significantly from the $10.953 million 30-year cost.

Policies to Advance the Transition

I only have one comment on this section.  The report notes that “New York City, strict fire safety rules make it very challenging to install energy storage batteries in most buildings, though there are clear guidelines for siting these batteries outdoors.”  There is a reason for those strict fire safety rules, namely that if the batteries are operated improperly, they can catch fire.  The health impacts of the toxic pollutants emitted during a battery fire are a real concern that cannot be overlooked.


I will conclude this post by addressing one paragraph:

“Fossil peaker plants in New York City are perhaps the most egregious energy-related example of what environmental injustice means today. Throughout one of the most diverse and technologically developed cities in the world, numerous polluting oil and gas peaker plants in the City are sited in low income communities and communities of color. These environmental justice communities continue to bear the brunt of the harmful impacts from dirty energy and industrial infrastructure that pose significant public health and environmental hazards. At the same time, private companies receive billions of dollars to keep this polluting infrastructure in place.”

As shown here, the evidence presented for the egregious environmental injustice claim is more rhetoric than fact.  There is no benign way to make electricity but affordable and reliable electricity is a necessity for public safety, health and welfare.  Today’s question is whether New York City can risk reliability on unproven technology at the scale needed for its needs and can afford the costs needed to make intermittent and diffuse renewable energy available when and where it is needed.  I do not dispute that there is a problem with peaker power plants in New York City but this study over-estimates the effects of the existing plants and under-estimates the difficulty replacing them with anything other than fossil fuels.



Author: rogercaiazza

I am a meteorologist (BS and MS degrees), was certified as a consulting meteorologist and have worked in the air quality industry for over 40 years. I author two blogs. Environmental staff in any industry have to be pragmatic balancing risks and benefits and ( reflects that outlook. The second blog addresses the New York State Reforming the Energy Vision initiative ( Any of my comments on the web or posts on my blogs are my opinion only. In no way do they reflect the position of any of my past employers or any company I was associated with.

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