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Low cost energy powering expansion at Berry Plastics bottle plant

By: Jim Johnson

May 29, 2014

A unit of Berry Plastics Group Inc. is using the promise of low-cost power from the state of New York to help fuel expansion at a bottle-making site.

Captive Plastics is receiving another 500 kilowatt allocation of electricity from the New York Power Authority to allow for expansion of its Dunkirk, N.Y., site by 20,000 square feet, according to the governor’s office.

The $18.5 million project in Western New York will create 10 jobs and follows a nearly 1,300 kilowatt allocation the firm received last December for the same site. Captive Plastics, at that time, agreed to create 15 new jobs.

The low-cost power comes from the authority’s Niagara Power Project located downstream from Niagara Falls.

Power from that state-owned hydropower site was allocated to four different companies this week by the authority to spur economic development. Captive Plastics received a seven-year allocation for the low-cost power, the state said.

The availability of lower cost hydropower allows companies to lower their overhead costs and expand their workforce and businesses, the state said.

“As someone who has worked his entire life in the private sector, I can tell you that the benefits of these low-cost hydropower allocations cannot be overstated,” said authority Chairman John Koelmel in a statement.

Captive Plastics, the state said, also is receiving a $979,000 in tax credits from New York’s economic development agency called Empire State Development in return for the company’s promise to expand operations and create jobs. Electricity from Niagara Power currently cost more than 50 percent less than wholesale market electricity in the region, the state said.

State economic developers view the expansion of Captive Plastics as a way to help offset, to some degree, the impending closure of two other sites in the same region. ConAgra Foods has announced plans two close two food plants by next year, a move that will cost more than 400 jobs, according to local news reports.

Evansville, Ind.-based Berry Plastics acquired Captive Plastics in 2008.

New York, in the latest round of hydropower allotments, also decided to allocate 100 kilowatts from Niagara Power for seven years to Durez Corp. of Niagara Falls, a maker of engineering thermoset resins and molding compounds.

Durez will “expand its facility and repurpose existing unused equipment” in an $800,000 project that will create six new jobs and retain 56 others, the state said.