Salem Officials Assess Potential Redevelopment of Retired Power Plant Site

The Salem Harbor Power Station, one of Massachusetts’ “Filthy Five” power plants, will close in June 2014 leaving behind approximately 150 jobs, nearly $5 million in tax revenue, and 65 acres of waterfront land. For decades the plant has provided considerable tax revenue to the city, but it has also been a stain on the waterfront and an environmental hazard. Now Salem officials are trying to figure out how to cope with the plant’s closing and looking at site redevelopment as a potential economic producer for the city.

Dominion Resources, the Virginia-based energy company that owns and operates the plant, announced in May that it will cease operating two of the plant’s four units by the end of the year and retire the plant by June 1, 2014. The decision to close the plant comes in preparation for new environmental regulations which go into effect in 2014. “This was a decision we had to make given the significant costs required to keep the station in compliance with pending environmental regulations and the falling margins for coal stations selling electricity in New England,” said David A. Christian, CEO of Dominion.

A union spokesman said in an earlier report he was confident the skilled and experienced workers would find employment elsewhere, but how the city will respond to the closing is still up in the air. The plant has been the largest taxpayer for the city, producing nearly $5 million in tax revenue. “I doubt anything will generate the revenue they currently do,” said Mayor Kimberley Driscoll.

Salem has received a $200,000 grant to redevelop the site from the Clean Energy Center. “In addition,” Driscoll said, “we have already started to reach out to state and federal officials to ask for their cooperation and assistance in planning for the future of the Salem Harbor Power Plant. Thus far, these officials have expressed a willingness to be involved and assist the city in any way possible,”

Mayor Driscoll has expressed optimism that the closing will mark a transition toward clean and renewable energy sources for the city and an opportunity to redevelop the waterfront site.  “I look forward to working with Dominion and all interested stakeholders in making sure that this site does not stay dormant following the power plant’s closure and planning for a bright new future for this site and for all of Salem,” she said.

What the future of the site will look like remains uncertain, though.

The city has conducted a site assessment study to determine potential future uses and their benefits both for the public and in tax revenue generation. The assessment considers three potential redevelopment plans: alternative power, renovation and change of use, and demolition and development.

Alternative power development would keep the site as a power plant but converts it into a clean energy facility – most likely a natural gas burning power station. Conversion would allow the city to retain a power plant tax generator.

The assessment deemed renovation and reuse of the building for other commercial uses not applicable due to the quality of the structure and the smokestack visibility.

Demolition and development would develop the site in accordance with the Designated Port Area (DPA) and Chapter 91 (Public Waterfront Act) requirements which promote water-dependent industrial uses for marine sites. However, this development could also include retail sites or a commercial shopping center which would provide public benefit and generates tax revenue.

The assessment highlights redevelopment scenarios which include a new gas turbine and/or the partial development of the site consistent with Chapter 91 and DPA. Whichever plan the city moves forward on, the plant site will likely not stay dormant for long.