PEABODY ― In spite of the city’s ongoing plans to install a peaker plant on Pulaski Street, representatives from Massachusetts Climate Action Network held a press conference Thursday to discuss the report findings from two separate consulting agencies.
Both were firm in their stance: The peaker plant is a bad idea for the city and the state.
“There is a moral justification to be made here,” said Sarah Dooling, executive director of Massachusetts Climate Action Network (MCAN). “The pollution and the public health threats that this peaker plant in Peabody poses must be addressed by the state.”
The peaker plant, originally proposed by the Massachusetts Municipal Wholesale Electric Company (MMWEC), has drawn opposition from environmental and citizens’ groups in the immediate area and the state.
Peaker plants are natural gas-powered electrical plants that only operate during high-demand times. An MCAN press release stated the Peabody plan, also known as Project 2015A, “will emit up to 51,000 tons of the greenhouse gas carbon dioxide into the atmosphere every year — the equivalent of adding 11,000 combustion engine cars to Massachusetts’ roads each year.”
A following statement released by MMWEC disputed MCAN’s figures, stating “The Peabody capacity resource is expected to run just 239 hours per year and emit approximately 7,085 tons of carbon emissions per year. Emissions will be below both national and Massachusetts Ambient Air Quality Standards.”
The environmental fallout predicted by MCAN and other groups could affect several of Peabody’s environmental justice (EJ) communities ― areas that have been deemed by the state as disproportionately affected by environmental hazards ― though MMWEC stated the Department of Environmental Protection’s Air Quality Plan approval, issued to the site in September of 2020, “constituted an independent health impact study.'”
While Thursday’s press conference was organized and attended by representatives of climate groups, the two presentations heard during the event were less focused on the environmental detriment of the peaker plant than its economic infeasibility.
The first report, presented by Maria Roumpani of Strategen Consulting, highlighted two more economically viable alternatives to a gas-fueled peaker plant: energy storage and buying wholesale from the capacity market.
According to Roumpani, a two-hour battery storage solution could deliver energy capacity at less than half of the annualized cost of Project 2015A ― $2.04 million to $7.29 million, respectively. A four-hour battery solution could operate at $5.83 million.
Buying energy wholesale from the capacity market would also be more cost-effective, according to Strategen’s figures. Roumpani sought to debunk MMWEC’s claim that Project 2015A would serve as a “hedge against the volatile capacity prices in New England’s energy market.”
After looking at the price forecast for capacity for 30 years (the projected lifespan of the peaker plant), Strategen alleged the projected volatility of the market ― and hence the savings afforded by the peaker plant ― only come into play around 2040. Market prices were to be more stable from 2020-35, which Roumpani’s report said could generate enough savings to terminate Project 2015A altogether. Furthermore, she added, the near-term projections were more likely to be accurate than the long-term, volatile projections.
“Even if MLPs (municipal light plants) were to pay higher prices in these later years, our analysis still indicates that relying on the market results in net savings over the entire planning period,” Roumpani said.
MMWEC disputed the information provided by Strategen as well, noting “the Strategen report relies on incomplete data and does not reflect the lower debt service and forward reserve revenue, which lower the project costs for the participating light departments. These omissions in the Addendum analysis result in understating the expected savings from the project by 30 percent.”
The next presenter, Bryndis Woods of the nonprofit consulting firm Applied Economics Clinic, also touched on market volatility ― this time in the realm of fuel prices.
“Gas prices have been historically volatile, and over time they’re forecasted to increase. Unpredictable and rising gas prices pose a risk primarily to customers’ bills in the towns with an ownership stake in Peabody (peaker plant),” Woods said. “Because those fuel prices get passed to customers.”
Woods also examined state and federal climate policy, noting that Project 2015A is in violation of current policies around environmental justice and fuel use. While peaker plants within a mile of environmental justice communities are now subject to an environmental review process, no such stipulation existed when Project 2015A was being created. Environmental regulations continue to “mature and develop,” Woods stated, thus a project like the Peabody peaker plant could become a sunk asset before its lifespan was up.
In spite of all the information presented by these two consulting groups, the peaker project has already been approved and funded. However, Dooling stated, there are still some ambiguities at play. Of the 14 participating communities who signed a contract with MMWEC, two ― Holyoke and Chicopee ― have requested to opt out.
“Site prep is happening, two communities have chosen to opt out, we don’t know the final decision on that yet, and we continue to oppose this plan,” Dooling said. “The statewide campaign ask continues to be Secretary (of the office of Energy and Environmental Affairs Kathleen) Theoharidis, please reopen the formal environmental review process.”
