BRIDGEPORT -- The South End's coal-fired electric plant -- the last in the state and the city's third-highest taxpayer -- is belching cash along with smoke from its landmark candy-cane stack.
That's the conclusion of the nonprofit Institute for Energy Economics and Financial Analysis, which Wednesday released a report showing steep declines in generation and earnings at the harborfront facility between 2008 and 2013.
"The plant does not appear to us to be financially viable ... past the end of this decade," said David Schlissel, who authored the report for IEEFA, during a conference call with reporters.
Schlissel suggested the city and state need to start planning for a future without the plant, which pays around $2.5 million in annual taxes.
"It's been our experience that the companies operating plants generally don't give a lot of notice before they decide to retire them," Schlissel said.
A spokesman for PSEG Power CT -- which in late 2012 was granted a new five-year operating permit by federal and state regulators -- did not respond directly to IEEFA's data or conclusions.
Instead, the company emphasized that the station, run during peak power demand to serve more than 500,000 homes from Bridgeport to Greenwich, plays a "pivotal role" in keeping the local electric grid reliable.
But city officials Wednesday provided a bit more insight into the plant's future.
David Kooris, Bridgeport's head of economic development, said in a statement the plant is moving toward a natural gas operation, but did not elaborate further.
Asked to clarify, Elaine Ficarra, spokeswoman for Mayor Bill Finch, said, "It's our understanding they're in the first stages of the application process." But what that process entails remained unclear.
PSEG did not return subsequent requests for comment.
Dennis Schain, a spokesman for the state Department of Energy and Environmental Protection, said he was not immediately aware of plans to shift from coal to gas at the Bridgeport site.
But, Schain said, "We're a deregulated industry, so they could do that."
IEEFA's report only fueled ongoing speculation that the plant was nearing the end of its operating life.
"We can't really see this plant functioning after a couple more years," Onte Johnson of the Sierra Club, one of several groups that had opposed the new five-year permit, said at the time.
In May 2012, UBS Securities LLC in a memorandum on PSEG wrote the plant "is particularly vulnerable to retirement eventually."
About a year later, President Barack Obama introduced a sweeping plan to cut national carbon emissions by 17 percent by 2020 in part by targeting plants like Bridgeport's.
According to IEEFA's analysis, between 2008 and 2012, generation at the Bridgeport site dropped from 87 percent to 3 percent, with an increase to 16 percent in 2013.
Simultaneously PSEG's pre-tax earnings plummeted from $164 million at the plant to $4 million in 2012. The plant earned $25 million in 2013.
Schlissel noted that PSEG does not release its earnings to the public, but said his data is based on "credible and conservative" assumptions based on knowledge of the coal industry and New England electric market.
And, he said, there is no reason to think things will get better.
"These numbers may be off a little bit, but we firmly believe the trend is accurate," Schlissel said.
Despite his comments about PSEG moving toward natural gas, Kooris added a note of caution in his statement.
"Ultimately the plant is private property and the site's future rests in the hands of PSEG along with federal and state regulatory agencies," Kooris said. "Mayor Finch will continue to have ongoing conversations with PSEG regarding the future of the site, and his door is always open for any member of the community who has concerns about the plant." http://www.ctpost.com/local/article/Report-ca...