ALBANY – State lawmakers extended two energy programs that industrial and political officials say keep upstate manufacturing competitive with the rest of the country despite historically high operating and business costs.
The state Assembly voted Thursday to place one-year extensions on Economic Development Power and Power for Jobs, which cut costs for companies – usually technology-based – that consume considerable amounts of electricity in a state where energy prices are among the country’s highest.
Locally, Gary Cummings, director of operations at Unison Industries in Norwich, said the Economic Development Power program saves his building roughly $200,000 annually, a significant amount considering the internal and external competition that exists in global markets.
“If the price of power goes up, I have to cut costs somewhere else,” said Cummings. “There are a number of ways to cut costs, but none of them are pleasant.”
The legislation accepting the extensions until June 30, 2008 went to the Governor’s desk Thursday.
In Norwich, Unison’s 288 employees design, manufacture and integrate electrical and mechanical components and systems for aircraft engines and air frames. Cummings said the reduced-price electricity allows them to stay on pace with the company’s eight other locations in Florida, Illinois, Kansas, New York, Ohio, Canada, Mexico and Thailand.
However, while year-to-year extensions will keep the program alive, they won’t calm uncertainty in budget planning.
“We have to have some sort of long-term program that gives us a predictable rate,” Cummings said. “If you get a year or a six month extension, it makes it real hard to predict what your costs will be.”
Economic Development Power had been in place since 1997, and a similar program, Power for Jobs, has existed since 1987.
According to Randy Wolken, president of the Manufacturers Association of Central New York, 70,000 jobs in Central New York, including the ones at Unison, are tied to these energy incentives. If they were to cease, he believes there would be “a significant economic impact.”
“The reality is many of these jobs would go away,” said Wolken. “They need this low cost of power to be competitive with the rest of the country.”
Manufacturers enrolled in Economic Development Power pay between five and six cents per kilowatt hour. Companies with Power for Jobs get reimbursed for a similar amount via rebate. Wolken said the next step getting these rates locked in for the long-term.
“This is an area (energy) where they can be competitive – that’s what makes it even more critical,” he said, explaining high taxes and workers compensation costs already put New York businesses at a disadvantage compared to other states. “We have to make sure we get a long-term energy program in place.”
Cummings praised the work of Assemblymen Cliff Crouch (R-Guilford) and Gary Finch (R-Auburn), as well as Senators Jim Seward (R-Milford) and Tom Libous (R-Binghamton) for their efforts in getting the extensions passed.
“They’ve done a great job for us,” Cummings said.
Crouch said developing a secure energy policy for New York is a top-priority.
“Companies like Unison need to be able budget three to five years down the road,” said Crouch. “They have to put contracts out with stability.”