Building owners discuss time crunch associated with Concord Steam’s closing

  • Plant operator Neil Stewart of Manchester opens an access door to one of the boiler furnaces at the Concord Steam Corp. plant in Concord on Tuesday, June 9, 2015.(ELIZABETH FRANTZ / Monitor staff)

Monitor staff
Published: 9/21/2016 8:08:03 PM

There was no need for steam heat Wednesday night in the Simchick Theater, which turned toasty warm as scores of people crammed into the room to discuss their options as Concord Steam prepares to shut down in 10 months.

“This is a blow to some people,” said Rich Woodfin of Charter Trust, which owns 90 N. Main St., a three-story building heated by Concord Steam.

Concord Steam will shut down May 31 due to accumulated losses and equipment problems after heating much of downtown Concord for eight decades. Concord Steam is selling its operations to Liberty Utilities for $1.9 million.

Woodfin said Charter Trust is in good shape to handle the roughly $30,000 cost of converting its building to what will likely be a natural gas boiler for hot-water heating. The main concern is getting it done in time, especially since roughly 85 owners of about 180 different buildings in Concord are all trying to do the same thing.

Wednesday night’s gathering was called to answer concerns like Woodfin’s, or at least start a discussion about them.

“No one is saying this isn’t a challenge,” said Michael Licata, director of government relations for Liberty Utilities. “Hopefully this is the first step for a lot of conversations.”

The gathering in the room at Red River Theatres looked more like a trade fair than a public meeting. Staffers stood at information tables from places like Merrimack County Savings Bank, which is putting together a financing package for Concord Steam customers; Johnson Controls, which designs and installs heating systems; the Jordan Institute of Concord, which advocates and consults for building energy efficiency, while heating contractors exchanged business cards with potential customers.

Among those customers present was Mark Ciborowski, who owns 11 buildings that will have to convert.

“It’s going to be a challenge. There’s the cost, but also the time, the energy, the anxiety,” he said.

How to proceed will differ from building to building, much of it depending on the state of the current system, he said. Some places have already converted to hot-water heaters that are fueled by a Concord Steam boiler. For those, converting to a heat pump system or a boiler fired by gas or even wood pellets will be straightforward.

Many older buildings, however, still have iron pipes carrying steam directly from Concord Steam throughout the structure. They will probably keep steam heat, since the cost and time of replacing pipes in walls is too great, but will have to install some sort of boiler to make the steam themselves.

Another question for owners to consider is whether to install air conditioning at the same time or pursue energy efficiency upgrades to cut energy use, he said.

During a public discussion period Wednesday, Concord City Manager Tom Aspell pressed Peter Bloomfield, president of Concord Steam, as to whether that company or Liberty Utilities might be able to establish a fund that would provide cheap “gap financing” to aid building owners faced with a sudden expense.

That seems unlikely at the moment.

Bloomfield said that the lower cost of getting heat from natural gas, compared to Concord Steam, would save customers so much money next winter that they might be able to absorb the cost of a new system.

Bloomfield estimated that Concord Steam heat will cost about $50 per million BTU this winter, whereas Liberty Utilities gas is about $12 per million BTU, implying that bills could be cut by two-thirds next year.

The news of the sale to Liberty Utilities came out July 21 as well as the news that Concord Steam would close May 31, 2017, the end of the heating season. Even that will require a 23 percent rate increase so the company won’t run out of cash in the interim. Typical of the scrambling produced by this 10-month window was Monday’s decision by the Concord school board to skip the time-consuming process of getting competing bids for a replacement system to ensure that the four city schools served by the company won’t be left without heat.

Licata, of Liberty Utilities, emphasized, from a legal or business point of view, the company is not buying Concord Steam, but just buying parts of its operation. Notably, Liberty Utilities did not buy the wood-fired power plant in the state office park or its underground pipes, whose ownership in the future is likely to become a point of contention.

(David Brooks can be reached at 369-3313 or dbrooks@cmonitor.com or on Twitter @GraniteGeek.)




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