Sweetheart Cup to get power plant, quit BGE

$200 million deal with Trigen stems from power shortfalls

September 30, 1999|By Shanon D. Murray | Shanon D. Murray,SUN STAFF

Trigen-Cinergy Solutions said yesterday that it signed a 20-year deal worth about $200 million with Sweetheart Cup Co. to provide electricity and steam to the paper and plastic food-ware maker's manufacturing facility at its Owings Mills headquarters.

The deal calls for TCS to build a 15-megawatt co- generation plant on the site, said James J. Abromitis, president of Trigen Energy Baltimore, the local branch of Trigen Energy Corp. of White Plains, N.Y. The plant should be completed by the fourth quarter of 2000, he said.

The megawatt plant could expand to 26 megawatts, about the amount it takes to power the University of Maryland's College Park campus, where TCS is building a similar cogeneration plant. Cogeneration plants produce electricity as well as steam.

Thomas Uleau, Sweetheart's president and chief operating officer, said in a statement that improved economics and "the reliability of service for on-site steam and electricity" led to the company's choice of TCS as its energy provider.

"High summertime temperatures and other difficulties experienced by local utilities throughout the Northeast have led to a significant increase in the number of industries seeking to build on-site energy generation," said Stephen Harkness, TCS' chief operating officer, in a written statement.

During the summer's heat wave, Baltimore Gas and Electric Co. asked Sweetheart and other large commercial and industrial customers to curtail energy use five or six hours daily for six days to free up power for other customers.

Sweetheart and 87 other companies participate in a voluntary BGE program that allows their power to be curtailed for up to 10 hours a day for a maximum of 12 days a year.

In return, the customers receive a monthly credit, BGE officials said.

"This summer was out of the ordinary," said John Moraski, BGE's director of system operations. "It was unusually hot and dry."

In 1998, BGE interrupted service to the 88 companies one time. In 1997, service was not interrupted at all, he said.

Abromitis said Sweetheart was "directly affected by the inability of BGE to provide power at all times."

Privately held Sweetheart, which employs 6,000 nationwide -- including 2,500 in Maryland, is one of the country's largest manufacturers of disposable plastic and paper products, with $844 million in sales last year.

TCS, a joint venture of Trigen Energy Corp. and Cincinnati's Cinergy Corp., has signed other big-dollar contracts recently.

In April, the state awarded TCS a $469 million contract to supply the University of Maryland's College Park campus with electricity, heat and air conditioning. TCS also was selected by the University of Maryland to provide heating services to more than 20 buildings at its downtown Baltimore campus and hospital, contracts that will generate more than $85 million for the company.

The company also supplies steam heating and cooling to 350 buildings in downtown Baltimore.

Last year, TCS won a 15-year contract to provide electricity and steam for Millennium Inorganic Chemicals' Hawkins Point plant.

Pub Date: 9/30/99

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