There are many reasons why we chose Salem. The harbor itself has a strong infrastructure (deep-water port access, proximity to interstate natural gas line and transmission headroom, among other things). Salem also is steeped in history of industry coexisting with commerce and residential uses. We welcome this opportunity to help the city write a new and exciting chapter for itself and its residents.
What are the economic benefits to owners of working with Footprint?
Older power plants can present a number of economic challenges for existing owners. New environmental rules and low energy prices may make these facilities uneconomic to run. At the same time, the owner may be concerned about the costs and uncertainties associated with any contamination of the site caused by a long-history of operations including on-site fuel and ash storage. Footprint is skilled at structuring transactions that can realize the underlying value of the site, while mitigating risk for the owners.
What is Footprint’s business rationale for seeking environmentally sustainable solutions?
More and more companies are recognizing what we’ve always known — that sustainability isn’t just good; it’s good for business. There are a number of reasons for this. A combination of new and anticipated laws and regulations, improved enforcement and market forces are doing a better job of charging back to companies the costs of their environmental impacts. As a result, by reducing their environmental impacts, companies can improve their bottom line. Customers and other stakeholders are also putting increasing pressure on companies to be “green”.
Finally, companies are beginning to realize that sustainable solutions themselves represent a growing market that they ignore at their peril. This is where Footprint Power comes in. At Footprint Power we are making markets in sustainability and converting environmental challenges into opportunities for sustainable solutions.
Why does Footprint propose to replace coal-fired power plants with natural gas-fired plants? Isn’t natural gas a fossil fuel as well?
Natural gas is a fossil fuel — like oil and coal — and it does produce carbon dioxide as a result of the combustion process. However, natural gas has a number of advantages over the other main fossil fuels that give it the potential to substantially reduce our carbon footprint. First, it is highly efficient from a carbon footprint perspective. Typically, using natural gas instead of coal or oil will result in a 50% reduction in carbon emissions. This reduction can be enhanced even further by using highly efficient modern combined-cycle generating equipment.
Second, it is an extremely flexible fuel. Unlike power plants fired by coal and fuel oil, technologically advanced natural gas-fired facilities can respond rapidly to the needs of the grid. This flexibility is designed to facilitate a higher concentration of intermittent renewable resources — such as wind and solar — than is currently possible because, by having such flexible gas-fired plants, grid operators can respond to sudden changes in renewable generation caused by variations in wind speed or cloud cover.
Having flexible units also allows grid operators to save resources and reduce overall emissions by calling on units only when they are needed rather than having to call units in advance of potential need and continuing to run them in case they are needed. At Footprint Power, we believe that flexibility is key, both in envisioning future uses for sites and in designing the new units to build on them.
What are the benefits to communities of working with Footprint?
For many host communities, the pending shut-down of an old oil- or coal-fired generating facility presents mixed prospects. On the one hand, these facilities may impose considerable burdens on their host communities in terms of visual impacts, loss in property values, emissions, coal dust, noise and other environmental and other impairments.
On the other hand, the facilities provide jobs, pay taxes and support the local economy in myriad ways and a shut-down could result in substantial disruptions to the community in addition to the blow to local morale caused by a shuttered and abandoned energy generating facility. Footprint works with the community to identify the development path that best meets its needs in order to ensure that the site continues to provide jobs, to pay taxes and to otherwise remain a productive resource and a good neighbor.
What is Footprint’s position on climate change?
Perhaps the largest and most intractable of environmental challenges is the prospect of climate change caused by man-made emissions of greenhouse gases. The science of climate change is well understood even as scientists are still working to understand the precise impacts of rising global temperatures.
The underlying issue is the excessive production of certain gases — including carbon dioxide and methane — through human industrial and other activity. It is due to the natural presence of these “greenhouse gases” in our atmosphere that our planet is able to retain sufficient heat from the sun to support life as we know it. However, as the concentrations of these gases grow, so do the temperatures on Earth — higher temperatures that disrupt our climate with devastating effects on people’s lives all over the globe.
The single most significant contributors to worldwide greenhouse gas emissions are power plants fueled by fossil fuels — particularly oil and coal. Of these, the very worst offenders from an emissions rate perspective are older, smaller coal facilities that were built before modern emissions standards were in place and before more efficient combustion methods became available.
Shutting these plants down represents one of the easiest first steps towards improving our nation’s greenhouse gas emission profile. By taking on this work, Footprint Power is doing our part to reduce emissions, one step at a time.
What is Footprint’s position on hydraulic fracturing or “fracking”?
While natural gas clearly has many advantages, legitimate concerns have been raised about natural gas produced through hydraulic fracturing or “fracking” — a natural gas extraction technique that is utilized with growing frequency in this country. Fracking consists of the injection of water, sand and other chemicals into geological formations at high pressure in order to create cracks in the formations through which natural gas or other natural resources can be recovered.
While fracking has been used for many years — particularly in the oil industry, new technology that allows it to be performed horizontally along shale formations that are rich in natural gas has opened up vast quantities of previously unreachable natural gas resources. Although the practice may have promise, two major issues have arisen.
First, concerns have been raised about the chemicals used in the process and potentially the natural gas itself ending up in — and contaminating — water bodies and drinking supplies.
Second, it is not entirely clear that the natural gas recovered through fracking will retain the advantages of natural gas produced through conventional means. In particular, it has been reported that fracking results in high levels of methane losses to the atmosphere. Since methane is a much more potent greenhouse gas even than carbon dioxide, this may result in an overall greenhouse gas emissions footprint for fracking gas that is worse than coal.
In light of the legitimate concerns raised about fracking, the U.S. Environmental Protection Agency is studying the practice and intends to report on its findings later this year. We were also encouraged by reports of the formation of an independent watchdog group formed of industry, environmental advocacy and other participants that would establish and maintain best practices in the industry.
In the end, Footprint Power’s position on fracking is simple: if it cannot be demonstrated to be safe to the environment and effective in reducing greenhouse gas emissions — or if it cannot be made safe and effective through appropriate regulation — it should not be pursued. Instead, we should utilize gas from conventional sources for electric generation in conjunction with a much higher level of renewable generation.
As a result of our position on this issue, Footprint Power will not pursue development opportunities that depend on the continuation of fracking and that cannot survive in the market with natural gas extracted through conventional means.
How is Footprint financed?
Of all the things that make Footprint unique, perhaps the most critical to who we are and how we operate is the way that we have financed ourselves. The reason this is so important is because – as anyone who is paying attention has noticed – the sources of funding for a company influence that company’s behavior.
As a result, the equity in our parent company, Footprint Power LLC, is funded entirely by the partners. This leaves us free to pursue the projects that we think are important, to take the time we need to develop the relationships with stakeholders that are critical to successful projects and to make the commitments necessary to earn trust and to assure quality results.
Once we have put the project together in a way that meets our stakeholders’ needs, we can bring in financial partners to that project who not only adhere to the more amorphous “project philosophy” but also value the project for all the features that make it work for the stakeholders. In this way, Footprint can create alignment between its goals, the goals of its investors and the goals of its stakeholders.
If many coal plants will shut down simply as a result of environmental rules and market economics, why does Footprint need to be involved?
Simply to shut the coal plants down is to do less than half the job. The sites of the facilities need to be cleared, remediated and put back to work for their communities — creating jobs, taxes and (where appropriate) energy again.
The possibilities for reusing these sites are endless and limited only by the needs of the community and the imagination of the developers. At Footprint Power, we approach each site with fresh eyes and we look for ways to meet the needs of the local community and take full advantage of the benefits of a given site.
With its historical access to the transmission grid and its infrastructure, the site of an old power plant is usually uniquely suited for a new generation facility. Where new generation is desired, using a portion of the site for this purpose makes good sense.
Depending on the local needs and resources, we might install a gas-fired facility, a renewable facility or a receipt point for a transmission line carrying power from utility-scale solar or wind facilities — or we might deploy a combination of these uses.
We have been asked why we are building a power plant that uses even a clean-burning fossil-fuel like natural gas rather than a wind farm or other renewable installation. There are really two reasons for this.
The first is that a plant like the new SHS will provide immediate benefits to the system in terms of greenhouse gas reductions and reliable, low-cost power not currently available from renewable sources.
The second is that a plant like the new SHS is a critical component of a mature generation system that includes high quantities of intermittent renewable power. Even with vast quantities of solar or wind power installed, there will be times when the sun is not shining and wind is not blowing where the system will rely on quick-start plants like SHS to keep the lights on.