The agreement spells out enforceable changes in operating protocols for the plant’s existing unit designed to ensure that the three new gas-fired peaking generation units will not increase overall air emissions when they become operational in 2012. PSEG Power Connecticut also committed to provide $500,000 to fund environmental projects in New Haven’s East Shore neighborhood.

Richard Lopriore, president of PSEG Power Connecticut, said: “This agreement is in line with PSEG’s commitment to support environmental responsibility while we continue to invest in Connecticut’s energy infrastructure.

“The agreement reflects our commitment to being good neighbors in the communities in which we do business. We thank New Haven Mayor John DeStefano, the City Administration and the environmental organizations involved for the good faith and diligence with which they participated in the discussions that led to the agreement.”

PSEG agreed to a series of conditions that it will seek to add to the operating permit for the existing New Haven Harbor Unit 1 and to the operating permit for the new peaking generating units. As a result of the agreement, the City will support Connecticut Siting Council and DEP approvals for the project. The environmental groups agreed not to oppose the project, the permit renewal for the existing NHHS Unit 1, or the permits to construct and operate the peaking units.

The operating protocols include reducing Unit 1’s maximum output while any of the peaking units are in service, and its minimum operating time. In addition, from May 1 to September 30 and on ‘Unhealthy Air Days’ as designated by DEP, the unit will be co-fired with natural gas to the extent possible. Unit 1 will also be co-fired with natural gas for at least one hour for each hour one of the peaking units operates.

The three peaking units are slated to go into service in June 2012. The $135m construction project is scheduled to begin in 2011. The new units will use natural gas as a primary fuel and be equipped with emissions controls to reduce nitrogen oxide and carbon monoxide emissions.

The Connecticut Legislature in 2007 mandated development of additional new peaking generation to support electric system reliability. PSEG’s New Haven project was among three chosen by the Department of Public Utility Control through a competitive bidding process.