THE LETTER TICKER: Observer Suggests Council Should Hold Off on the Fuel Oil Phase-out Due to Substantial Costs to Older Buildings

WPCNR THE LETTER TICKER. May 5, 2014:

(Editor’s Note: a WPCNR reader contributes a more up-to-date cost analysis than the EDF study provided in a WPCNR article on tonight’s No 4 and 6 fuel oil phase out air quality legislation on the consent agenda. The EDF study was a project done in 2010. Times and costs have gone up, espcially for White Plains buildings, the reader points out:)_

Dear John:

                Below are some reasons the Common Council should consider delaying action on this proposed ordinance until the financial implications are studied more carefully.

                1.            The difference in cost between #6 oil and #2 oil is substantial. 

Today, that difference is $0.496 per gallon, meaning that #2 oil is $0.496 more per gallon than #6 oil.  This means a building which uses 100,000 gallons of fuel oil annually will pay $49,600.00 more per oil at today’s prices.  This is in addition to the cost of converting to #2 and/or natural gas.

                2.            The cost of conversion analysis in the EDF study are completely unrealistic.  For instance, a natural gas burner for a 100 unit building costs approximately $55,000.00, not the $10,000.00 listed in the EDF study.  Similarly, relining a 6 story building chimney actually costs around $20,000.00, not the $5,000.00 in the EDF study.  Equally unrealistic is the natural gas piping estimate of $10,000.00. 

Con Edison will only bring the gas line to the property line and the property owner must pay the cost to extend the gas line from the property line to the boiler.  This process involves street opening permits, digging trenches, laying pipe and welding.  I cannot speak to the costs for securing oil tank since I don’t know what is involved and I am not familiar with the cost of condensate pumps.

                3.            A more accurate cost estimate is available to me.  One co-op I represent is currently converting to natural gas.  The project cost is $182,000.00.  More than 1/3 of the cost is to extend the natural gas line.  The co-op is projecting annual savings of approximately $32,000.00 from using gas instead of #2 oil, meaning the cost of conversion will be recovered in 6 years, not the 1.1 years in the EDF study.

                4.            For other buildings, for instance where the boiler is set back further from the street or is located in the rear of the building, the costs will be higher and the resulting cost recovery period will be longer. 

                5.            In addition, has anyone studied whether Con Edison has the capacity to provide natural gas to all the buildings affected?  Some buildings, particularly in the older neighborhoods like Eastview and North Broadway, Con Edison gas lines in the street may need to be enlarged to provide capacity for these buildings to connect.

                6.            Some co-ops & condos, particularly older buildings in the Eastview, North Broadway & Lake Street area, are suffering from financial hardship and may lack the resources to commence and complete the conversion within the prescribed time lines.

James W. Glatthaar,

White Plains

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