We’re incredible.

Think about it: The New York Power Authority’s license to control Niagara’s hydro-electricity is about to expire. Our greatest asset — hydro-electricity — about to be stolen — again — and we sit utterly mute.

If, in case, you dare to speak, here are some facts you ought to know:

NYPA was created by the state Legislature in 1931 to provide (don’t laugh) “low-cost electricity for the people of New York.” A “public benefit” corporation, whose board of directors is appointed by Albany, NYPA operates the Niagara Power Plant and sells the power to private utilities, government and neighboring states. Ironically, although the Niagara generates more than $1 billion (true worth) of electricity per year, NYPA sells none of it to local residents.

Consider how harmful this is: a region should benefit by its natural assets, as it has to compensate for natural disadvantages. For example: Florida has warm weather/low heat bills. It has no rushing river. Its residents pay for high-priced electricity.

Our region has cold weather/high heat bills. But, we pay more for electricity! According to Electric Power Monthly, Floridians pay 11.25 cents per kilowatt/hour, while Western New Yorkers pay 16.72 cents.

Floridians benefit by their natural asset: sunshine. Western New Yorkers do not benefit by their asset: raging river-power.

To set the record straight, NYPA doesn’t make a billion a year from the Niagara, because it sells power at low cost to New York City and eight other states. Still, NYPA derives an enormous income from our river. That money goes to sustain 1,000s of high-paid Albany-patronage jobs; “outside studies,” and purchase of equipment.

NYPA has hurt us immensely: We rose to prosperity on hydro-power. It attracted industry, which all but left since NYPA (and the end of low-cost power) became a fact of life — in the place where low-cost electricity was introduced to the world.

Indeed, until 1957, Niagara hydro-power was controlled locally. Niagara Falls was “The Power City.” In 1956, Compton’s Encyclopedia wrote: “Water power helped build the city of Niagara Falls. The falling of water provides a great and constant source of power for hydro-electric plants which supply the city and surrounding area with abundant and cheap electrical power.”

Following a (1957) rockslide collapse of a local power plant, NYPA Chairman Robert Moses told us that NYPA, acting as “steward” of Niagara’s hydro-power, would be the only way to ensure continued prosperity in our region. A 50-year license (until 2007) was granted to NYPA, with the consent of the people and their elected leaders.

With no direct accountability, NYPA, over five decades, accommodated the ten-thousand back-door, sweet-heart deals — at the behest of successive politicians. In the end, we lost all benefit of having hydro-power in our midst.

Today, Niagara residents don’t get their power from the river, but from burning coal and other inefficient methods, purchased at high mark-up from National Grid, a company owned by investors from England. Consider how galling this is: We buy expensive electricity from British investors, and NYPA takes our low-cost hydro-power, which would create thousands of local jobs, and sells it elsewhere. Meanwhile, the profit from our local power pays for thousands of patronage jobs in Albany and White Plains, a suburb of NYC.

After 50 years of “stewardship,” only two places in the USA pay more for electricity than Niagara: Massachusetts and Hawaii. According to Electric Power Monthly, 36 percent of the nation pays less than half what we pay for electricity. This is a striking fact, since our region may be the largest producer of low-cost electricity in the world.

Of course, it wouldn’t be fair to say NYPA does nothing for our community: 120 businesses receive “allocations” of “low-cost” Niagara power. But what about the other 10,000 businesses? How about the one million people living in the region? There’s enough electricity to give everyone within 30 miles of the river low-cost (or free) electricity.

If we grant NYPA a 50 year renewal, NYPA will give Niagara a pittance: $5 million per year for 50 years — to be split among seven municipalities/school districts (and not adjusted for inflation.) Compared to the multi-billion dollar value of Niagara-power, $5 million is 5 cents.

I imagine the editors of the Guinness Book of World Records are keenly watching. Under the section of “Stupidest, Laziest People in History,” we may soon find Western New York listed: the only people in the history of the world who could lose their original, wealth-producing, and world-wide essential asset/commodity — and when given the chance to get it back — by merely speaking up — (NYPA will not be renewed if the voice of the people was strongly against it) — those imbecilic sluggards said nothing.

But, alas, they won’t be silent long: you’ll hear them grousing in every coffee shop and tavern complaining about how lousy and broke and unlucky everything is here. And blame city hall or the politicians. But not themselves.

Incredible!

Frank Parlato Jr. is a Niagara Falls businessman.

Below is a response by Timothy S. Carey, the president and Chief Executive Officer of the New York Power Authority.

Power projects local benefits are many

By Timothy S. Carey
Niagara Gazette

January 08, 2007

Gov. Eliot Spitzer, in his recent State of the State Address, made note of the significant contributions of the Niagara Power Project among the major infrastructure investments that “became the foundation for the economy that defined New York as the Empire State.” 

“In order to revitalize our economy, we must get back to our roots and stake out a bold vision for infrastructure investment. Past investments in the Erie Canal, the Thruway and the Niagara and St. Lawrence power projects became the foundation for the economy that defined New York as the Empire State” the governor said. 

It is very encouraging to see the fundamental importance of New York Power Authority (NYPA) hydropower projects prominently noted by New York’s new governor. It’s a shame that the negative perspective of the Gazette’s guest columnist, Frank Parlato, prevents him from seeing those benefits as well. Even more troubling than his pessimistic portrayal of the Niagara Project’s contributions to the economy are his utterly inaccurate assertions about the project’s benefits for Western New York. 

Contrary to his claim that Western New York does not benefit from the Niagara Project, state law reserves significant portions of Niagara hydropower for use by industry in Western New York. Of the 62,000 manufacturing jobs in Western New York, some 44,000 are linked to power supplied by the Niagara project. That’s right; more than 70 percent of the region’s manufacturing jobs benefit from low-cost Niagara hydropower. In addition to the power supplied to local industry, Niagara hydropower also provides savings to residential electricity customers of National Grid and New York State Electric & Gas in Western New York. 

Parlato ignores the fact that the federal license for the Niagara Project has very little to say about who may be supplied with hydropower generated by the project. The distribution of Niagara Project hydropower is governed by federal and state law. Half of all the power generated by the Niagara Power Project is required by federal law to be supplied to municipal electric and rural electric cooperatives in New York and neighboring states. (Seventeen Western New York communities are among local public power systems served by Niagara power under this requirement of federal law.) 

As noted earlier, state law reserves a substantial share of hydropower from the Niagara Project for Western New York industry. However, state law also requires that the project “shall be considered primarily as for the benefit of the people of the state as a whole.” 

While federal and state laws require that NYPA serve statewide responsibilities, we do provide an extensive array of benefits to Western New York including: 

n Completion of a $2.3 million renovation of the Power Vista, the Niagara project’s admission-free visitors center, a major Western New York tourist attraction.

n Providing $7 million annually to support the operation and maintenance costs of Artpark and the Niagara Reservation state parks.

n Establishment and ongoing sponsorship of the Historic Lewiston Jazz Festival, which had had total attendance of more than 30,000 and an economic impact in excess of $800,000 over the three-day period of the annual festival.

n Contributions of $5 million to help pay for the renovation of the Niagara Falls observation tower and of $1.5 million for educational exhibits at the Gorge Discovery Center;

n Contribution of $7 million for improvements to Niagara Falls city-owned recreation facilities, including rebuilding Sal Maglie Stadium, upgrading the ice rinks and providing sports fields adjacent to the new Niagara Falls High School.

n Extensive energy efficiency and clean energy technology projects in the region such as removal of coal-burning furnaces from schools in Buffalo, installing energy-efficient refrigerators in more than 1,600 public housing apartments in Buffalo and high-efficiency microturbines at the Town of Lewiston Wastewater Treatment Plant. In total, NYPA has invested nearly $50 million in energy-saving projects at 137 schools and other public facilities in Erie and Niagara counties.

n Assisting the Niagara River Greenway (As part of the Niagara Project relicensing agreement, NYPA has included $7 million annually for 50 years for the Greenway.). 

The settlement agreements achieved in support of the relicensing of the Niagara

Power Project contain a wide array of additional community support measures, including more power for local communities. It is unfortunate that Mr. Parlato continues to ignore the fundamental facts about the laws governing the project’s resources, the relicensing process and the extensive benefits that NYPA provides to Western New York.

Timothy S. Carey is the president and Chief Executive Officer of the New York Power Authority.