NYPA quickly approvess Alita plant in Buffalo

September 25, 2013 Updated Sep 25, 2013 at 4:56 PM EDT

By David Bertola, Buffalo Business First

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NYPA quickly approvess Alita plant in Buffalo

September 25, 2013 Updated Sep 25, 2013 at 4:56 PM EDT

The New York Power Authority board of trustees has awarded a low-cost hydropower allocation of four megawatts to Alita USA Holdings, a steel manufacturer planning to build a 340,000-square-foot pipe mill in Buffalo.

In addition to the low-cost hydropower, NYPA, Empire State Development and the Erie County Industrial Development Agency are in the process of developing an incentive package of roughly $10.4 million in grants and tax credits in support of Alita’s Buffalo facility. This includes a $2 million award recently recommended by the Western New York Power Proceeds Allocation Board that the NYPA trustees will consider after a required state environmental review.

Earlier this month, Alita USA Holdings confirmed it will open a $102 million, 350,000-square-foot plant in South Buffalo by 2015, with the plant employing more than 172 people.

The low-cost hydropower to Alita will be provided under a seven-year contract, with the allocations drawn from a block of electricity, known as Replacement Power, generated at NYPA’s Niagara Hydroelectric Power Plant.

Under state law, allocations of power to Western New York businesses from the Niagara plant are for firms within a 30-mile radius of the hydroelectric facility, or in nearby Chautauqua County, at a price that is currently more than 40 percent lower than wholesale market electricity in the region. The hydropower is linked to tens of thousands of jobs at more than 100 businesses in the region with a combined payroll of more than $2 billion