Letter: Energy park is about the bottom line


To the editor,

I wanted to revisit the Beacon Falls fuel cell plant article published July 10 in the Citizen’s News. The article, while overall capturing the overall gist of comments occurring during the meeting regarding the proposed fuel cell energy plant, effectively summarized comments from others and attributed them to me. My comments were as follows: “At the end of the day, you are not here to benefit Beacon Falls, you are here because it benefits you.” That comment is spot on. The park is proposed to be placed in Beacon Falls, not as a favor to the town, but because the Beacon Falls location presents the best ROI or return on investment. Why? Reasons would include that the proposed building site, the former quarry is already owned by one of the partners of the project, so land purchase and all that comes with it is a non-factor as well as an electrical substation is already located a short distance away, making a connection to the grid convenient and relatively inexpensive. These factors represent significant cost savings versus other locations. I am sure there are others. ROI, IRR, NPV, take your pick. It’s about the bottom line.

Another gentleman raised the issue of tax abatements that would most likely be sought from the town by the project. The point was valid in my opinion. It is not unusual for large capital projects by private developers to seek tax abatements from the town in which they are located. These can be mutually beneficial in some cases where the project, while not generating tax revenue directly to the town, generates it indirectly via hiring of employees or utilization of local services, etc.; things that contribute to an overall increase of local economic activity.

This does not appear to be the case with the fuel cell energy plant. While the build of the plant will create or support jobs elsewhere in the state, with the exception of temporary jobs created during the construction phase, it most likely won’t in Beacon Falls. Once complete, the plant is designed to run without a regular staff. That means no hiring. Other than the gas needed to run the plant, there probably won’t be much needed once it’s up and running. Therefore the potential to significantly increase local economic activity is most likely limited and the benefit of tax abatement to the town of Beacon Falls would be limited as well. That said it is highly unlikely that the business case as developed by CT Energy & Technologies for the world’s largest fuel cell park, a multimillion dollar endeavor, is dependent upon tax abatements from the small town of Beacon Falls to be profitable.

There are lots of pluses for the state and for the partners of CT Energy and Technology in building the world’s largest fuel cell energy plant in Beacon Falls. For Beacon Falls residents there is really only one. That is receipt of substantial tax revenues. The only benefit from a plant such as this lies in its potential contribution to Beacon Falls’ tax revenue.

As noted in the Citizens News article, when pressed to provide an estimate of this, Mr. Corvo, a representative of the proposed energy park, was somewhat evasive and combative in this regard. Indeed, I was surprised that representatives from the town in attendance did not gently probe on this issue as there most certainly will be a cost in terms of fire, police and others associated with this plant. If they aren’t paying, we are.

The town has an obligation to look to bring in viable business entities and encourage them to reside in Beacon Falls. However this is only if they are contributing towards the tax base. We depend on our elected officials to make this happen.

Karl Johnson

Beacon Falls