Company News

Youngstown Thermal Operator Invests $1.7M in New Boiler

YOUNGSTOWN, Ohio – A $1.7 million package boiler slated to arrive by Dec. 11 should soon result in savings for customers of Youngstown Thermal LLC.

Installation of the new boiler, which will burn natural gas, is one of the upcoming improvements to the Youngstown Thermal system, which is being acquired by SOBE Thermal Energy Systems, based in Dublin, Ohio.

In August, Mahoning County Magistrate Timothy Welsh approved the sale of Youngstown Thermal and Youngstown Cooling LLC to SOBE for $250,000.

The transaction still must be approved by the Public Utilities Commission of Ohio. In June, Reg Martin, court-appointed receiver for the Youngstown Thermal entities, entered into a management agreement with SOBE to handle day-to-day operations until the sale can be closed.

“That’s where things stand right now,” says Dave Ferro, director of energy management services for Pennoni. The Philadelphia-based engineering firm is working with SOBE on upgrades to the Youngstown Thermal physical plant, including the boiler being installed next week.

“The system is horribly inefficient as it is and we engineered a way to bypass that inefficiency in a very cost-efficient way that should help right the wrong that’s been going on there for some time,” Ferro says.

“The existing facility is a steam plant. Everything in that facility runs on steam,” he says. “No. 1, that’s horribly inefficient.

“No. 2, those boilers were designed to run at higher outputs,” he continues. “Because you don’t have the load to sustain it and everything else runs on steam, you’re making more steam than you need to meet the demand, which is why costs are so expensive.”

Installation of the boiler, which should only take three days once it arrives, according to Ferro, will enable costs to customers to be reduced “pretty quickly,” definitely in the first or second quarter of 2020, he said.

“So there’s light at the end of the tunnel for the clients,” he remarked.

The new boiler is the first phase in a series of planned improvements to the Youngstown Thermal assets that Ferro outlined during a meeting just before Thanksgiving with representative of about a dozen Youngstown Thermal customers – nearly half of the customer base.

Those present were encouraged by what they heard. The Business Journal was not permitted to attend.

The upgrades discussed “will bring that whole steam system into the 21st century,” observes Rich Mills, president of Ohio One Corp. Ohio One owns several downtown buildings that are on the Youngstown Thermal system. “It was pretty encouraging,” he adds.

If SOBE and Pennoni can deliver everything that was discussed, it could provide “a great opportunity” for current Youngstown Thermal customers to see lower rates, comments Colleen Ruby, director of operations for Oh Wow! The Roger & Gloria Jones Children’s Center for Science & Technology.

“It could definitely be something that could draw more customers to the area,” she says.

Pennoni’s Ferro pointed out that SOBE is “putting money on the table without ownership” so that customers can see relief in rates.

“The bottom line is we’ve got to minimize waste. We can’t have waste costs in a plant that is in bankruptcy,” he says. “That is not an acceptable position to be in, and you can’t expect customers to pay a premium for steam for an extended period of time. You’ve got to solve the problem.”

Copyright 2020 The Business Journal, Youngstown, Ohio.