WHEATFIELD – Three hundred thousand tons of New York City garbage – enough to fill the Rose Bowl one and a half times – would be hauled by rail to a Niagara Falls incinerator to help power the Cataract City’s industries, under a plan presented Wednesday to the Niagara County Industrial Development Agency.
Covanta Energy, which operates an energy-from-waste incinerator on 56th Street, applied for a tax break on a multipronged $30 million expansion project.
Covanta business manager Kevin O’Neil said the project includes a $7 million steam pipeline to the new Greenpac paper mill; a natural gas-fired boiler to back up the garbage incinerator that produces the steam; a rail transfer station to accept the trash from Manhattan; and a special waste-handling facility to prepare the garbage for burning.
Covanta supplies steam to help power the industrial processes at five plants: Occidental Chemical, Niacet Corp., Praxair, Goodyear and Norampac, the parent company of Greenpac.
“This shows you how the industrial base of Niagara Falls is all tied together, and Covanta is at the center of that,” O’Neil said. “Our steam supply is critical to supporting 600 jobs in Niagara Falls’ industrial area.”
The Covanta expansion is projected to add 23 jobs to the 86-person workforce currently at the incinerator.
O’Neil said the rail transfer station would be built on 15 acres that Covanta intends to acquire from Praxair. It’s part of a 70-acre brownfield next to the incinerator.
Niagara Falls Mayor Paul A. Dyster said that parcel was the subject of a purchase option Praxair gave to a company that had proposed to erect an ethanol plant on the site, but that company sold the option to Covanta.
At present, about 300 trucks a day haul waste to Covanta, which burns about 800,000 tons a year. O’Neil said 60 percent of the trash is trucked from Canada, and that amount is to be drastically reduced as Manhattan municipal waste is brought in through the new rail siding.
“We regarded that as a net improvement,” Dyster said. “This would reduce traffic on the international bridges, which we think is important. … We’re big fans of the expansion of the rail network.”
Dyster said the Big Apple trash will be much the same as the garbage now being trucked in from Toronto. “The materials are containerized, and the containers won’t be opened until just before they’re burned,” he said.
With Greenpac’s opening expected sometime next year, truck traffic in that part of the city would figure to increase, Dyster said, so getting garbage trucks off the streets to and from the incinerator also is a positive.
O’Neil said waste hauling over the border won’t be completely eliminated, since Covanta has contracts with the General Motors plant in St. Catharines, Ont.
He said Covanta has a 12-year contract to supply steam to Greenpac. The 24-inch pipeline to be built would be nearly a mile long.
“It’s a very exciting project,” IDA Chairman Henry M. Sloma said. “The energy is helping to drive all this industrial growth. … They’re going to do their best to hire people locally.”
O’Neil said Covanta’s new jobs will pay up to $100,000 a year, with full benefits.
The company asked for a 15-year payment-in-lieu-of-taxes, or PILOT, arrangement on the value of its expansion, not on the current plant. It also seeks an exemption from having to pay sales taxes on building materials and equipment for the expansion, and an exemption from having to pay mortgage recording tax on the land deal.
Members of the IDA staff estimated that Covanta would save a total of almost $8 million in taxes over the next 15 years, but the payroll for the newly created jobs would be about $2 million a year. Covanta’s current payroll is $8.9 million a year.
IDA attorney Mark J. Gabriele said Covanta just closed on a $165 million refinancing of its debt through a bond issue approved by the Niagara Area Development Corp., an IDA subsidiary. The bonds must be paid off by Covanta.