Generator Mandate Leaves Station Owners in the Dark

New York State quest for backup power opens Pandora’s box of concerns

Published in CSP Daily News

By  Traci Carneal, Freelance writer

A new, well-intentioned law in New York State, designed to ensure centrally located gas stations in downstate regions have backup power in case of a crisis, is creating a state of confusion as affected station owners face a compliance deadline of April 2014.

Industry experts say the crux of the problem is that New York State Energy Research and Development Authority (NYSERDA) officials proposed a plan without a clear understanding of the generator industry and installation logistics.

According to Jeffrey Cronen, national sales director for Kohler Co., the “devil is in the detail,” whether the goal is bringing in a rental unit for backup power or actually installing a permanent generator on site. “[NYSERDA] basically moved this law through without much thought,” he says. “There was talk about the proposed law, but not much information about the details. To my knowledge, they didn’t consult the industry, and the way the law is written now, it may be very hard for gas station owners to comply.”

The measure affects fuel locations in Nassau, Suffolk, Westchester and Rockland counties, as well as New York City, that are located within half a mile of an exit on a controlled access highway or a designated evacuation route. The law requires these sites be prewired for backup power by April 1 of next year. They also must have a written plan in place for deploying a generator within 24 to 48 hours of an emergency declaration or loss of power. 

Brian Mauriello, vice president of sales & marketing for Kinsley Power Systems, a major Kohler distributor in the Northern states, concurs with Cronen that a more workable mandate would have been possible if NYSERDA had consulted with industry professionals during the drafting stage. Because it’s too late to alter the language, Kinsley has teamed with other industry partners, including Kohler, to ease the process for any c-store operator struggling with generator decisions and compliance. Together, the companies are distributing educational materials and have offered to lead seminars for the members of organizations such as the New York Association of Convenience Stores (NYACS) and the Service Station Dealers of Greater N.Y.

Kinsley published a brochure earlier this year with renting vs. buying guidelines for store owners, with a recently added Emergency Generator Size Estimation Sheet, and exhibited at a trade show. “We brought a trailorized unit and switches to the NYACS show to try and explain to store owners how it all works,” Mauriello says. “Some of them don’t know and haven’t had to know prior to this mandate, and the fact that many elements of the mandate have not been thought out further complicates the situation.”

Devil in the Details
Several meetings with NYSERDA confirm officials did not completely understand the complexities of the law, according to Cronen. “They really didn’t know what they were getting into—from the logistics of obtaining, storing and then getting rental generator units to stores, to the true cost of installing a permanent unit,” he says.

Starting with the cost issue, a huge discrepancy exists in terms of state-provided financial assistance for a prewire vs. permanent install. The $10,000 for a prewire is sufficient, but $13,000 for a permanent install isn’t even close, says Mauriello, pointing out that a new generator costs a minimum of $20,000 just for the unit.

“People don’t realize the logistics and barriers to getting a permanent installation,” Cronen says. “Land use, gas or fuel connection to the unit, permits—it all has to be inspected and signed off on. From a time frame perspective alone, it’s highly unlikely a station that decides to purchase a generator could have it installed and up and running by the compliance deadline.”

NYSERDA plans to offer a generator lease pool for stations that choose to go with the prewire option rather than a permanent unit onsite. Again, the agency has underestimated the logistics of this concept, according to Cronen and Mauriello.

“It’s a huge undertaking to have a fleet of rental generators ready to go,” Cronen says. “If you don’t have every single detail worked out—how the unit gets there, how it gets off the truck, how you will get your licensed electrician to hook it up, where the fuel is coming from 24 hours later when it runs out—then a rental system is not going to work.” Further, Cronen asks, where will the state get all the generators it needs to fulfill the requests of stations in a wide-spread crisis? “Even in normal times there is a shortage, much less during a crisis.”

What’s Next
Mauriello senses growing frustration among gas station/c-store owners about the lack of communication across the state. 

“No one seems to be laying out a plan of how this process will unfold from a rental or a purchase perspective,” he says. “If I’m renting, how will it work? Who will I call? If I’m choosing to install a permanent unit, can I possibly have it done by April of 2014? Put it this way: If I were both a generator person and a c-store owner, I would be losing my mind right now because I know the harsh realities of making either concept work.”

Some independent retailers who have experienced a severe outage prefer not to have backup power. One of Cronen’s friends who owns a station on Long Island and lived through Hurricane Sandy says he will “never open during a situation like that again … I’ll take a hit and just close.” Dealing with angry customers, such as people throwing coffee and gas cans and spitting at him when the fuel pumps locked up, is an experience he would prefer not to repeat.

“Some folks are thinking it’s easier to take the prewire option and sign up for the rental unit, and if they don’t get one, they don’t get one,” Mauriello says. “They are just as happy to close business until the storm passes.” Owners with multiple stores are leaning toward prewiring all stores in locations the mandate covers and then purchasing a few units that can be moved from store to store.

Station owners also need to remember that if they choose to purchase and install a unit onsite, they also need to comply with local ordinances.

Citing New York as the guinea pig for a generator mandate in the New England area, Mauriello notices several towns in states such as Rhode Island, Massachusetts and New Jersey proposing their own mandates. “I think this is a trend worth keeping an eye on,” he says.