PITTSFIELD — City officials on Monday began assessing their options for Pittsfield's future trash and waste pickup needs following Covanta Energy Corp.'s announcement that it plans to close its waste-to-energy facility in March.
If the New Jersey-based company follows through with its plan, it would force the city to find another way to dispose of its trash and recyclables.
"This is disconcerting at best in terms of how we manage municipal waste collection and disposal," said Mayor Linda M. Tyer in a statement issued on Monday. "The city is in the process of understanding the impact of this potential closing and working toward a possible solution to keep services in operation."
Covanta announced on Friday that it planned to close the Hubbard Avenue facility "based on current economic conditions," according to company spokesman James F. Regan.
"This tough decision was made based upon current economic conditions facing the facility," Regan said. "High operating costs and the size of the facility have made it increasingly difficult to run the plant profitably.
"To operate well into the future, the facility would require certain investments," he said. "Barring a change to the current revenue structure, the economics do not work to justify continued operations and the necessary investments."
The Hubbard Avenue facility, built in 1981 by Vicon Construction Co., has been run by Covanta since 2007. Covanta took over the structure when it purchased Energy Answers, which is the firm that bought the facility from Vicon in 1994. Pittsfield's energy-from-waste facility is one of the oldest such plants in the country. Covanta operates 45 total energy-to-waste plants.
Covanta's decision to provide advance notice of its intention to close the plant was done to give its business partners and customers enough time "to make appropriate arrangements for the future," Regan said.
"Employees will be offered post-employment severance benefits and have been encouraged to apply for open positions at other Covanta facilities," he said.
Regan said Covanta notified the plant's 25 employees in March regarding its intentions to close.
But Bruce Collingwood, Pittsfield's commissioner of public utilities, said Covanta's announcement came as a surprise because the contract with the company was extended last July to run through June 20, 2020.
"There was some language put in there if they were to close," Collingwood said, referring to the amendment of the current contract. "Maybe there was a little inkling. It's not unusual to put language in [a contract] to protect both parties, but there was no discussion at the time that they planned to close."
He said the contract calls for the company to notify Pittsfield officials in writing that it plans to close the plant within 150 days of the official closing date.
"I'd expect we'd get something in writing pretty quick," he said.
Covanta will "continue to evaluate opportunities to improve the economics of the facility," Regan told The Eagle via email on Monday.
But it doesn't appear that Covanta is interested in keeping the plant open until its contract with the city expires.
"While it is difficult to predict the future and anything can happen over the next year, we plan to cease operations in March of next year," Regan said. "There will be no extension of services beyond that date."
Collingwood isn't sure if there are any legal avenues the city can explore if Covanta shutters the facility before the current contract expires.
City Solicitor Richard M. Dohoney did not return a telephone call seeking comment on Monday.
A shutdown also would impact Crane & Co of Dalton, the sole supplier of currency paper for the federal government.
"Covanta has been a dependable partner for the supply of energy to our plant," said Rich Rowe, Crane's president of U.S. Government Products, in a statement. "As a result of their decision to close the Pittsfield facility, we have been actively exploring various options to secure a cost-effective energy course for our plant.
"We are hopeful to find a third-party to operate the facility but will also evaluate the feasibility of in-house solutions," Rowe said.
Covanta will work with Pittsfield officials to find a new disposal outlet for the city's waste, Regan said. Those options include a possible sale of the Hubbard Avenue facility, he added.
City officials will also have to consider other options for waste and trash removal.
"If that facility becomes mothballed, we can't take trash there," Collingwood said. "We have the option of getting someone else to run that facility. Right now trash goes there to be burned, but the recyclables are taken to (another facility) in Springfield. Independent of burning, that's where they'd go.
"We don't know if it's an option for someone to assume the responsibility of taking over a burn plant, so trash may or may not go there, or (it could) go to another facility," he said. "The drop-off area is independent of the facility. It could be subleased, I guess, through other operators."
If the city's trash has to be taken out of the city for disposal, it would raise the amount Pittsfield pays for trash removal, said state Rep. Tricia Farley-Bouvier, D-Pittsfield.
How much more the city would have to pay for trash removal would depend on the distance trucks would have to travel to reach another facility.
"The farther we'd have to take it, the more expensive it is for us," said Collingwood, who listed another Covanta facility in Canaan, N.Y., or facilities in Springfield as possible options.
"But there are options like other haulers in the area," he said.
Contact Tony Dobrowolski at 413-496-6224.