New York is Wrong to Close Indian Point

New York State has a healthy energy mix, relying in large part on highly reliable sources: nuclear, natural gas, and hydro. Unfortunately, the state’s leaders consistently work to undermine this reliability. They block pipeline projects that would improve the availability of natural gas for commercial, residential, and power purposes, and there is constant opposition to the continued operation of the state’s six nuclear reactors. This problem is most evident in regards to the two reactors at Indian Point.

On April 30th, Unit 2 at the Indian Point Energy Center in Buchanan, New York, 24 miles outside of New York City, is set to close. Unit 3 will follow it a year later on April 30th, 2021 (Unit 1 shut down in 1974). Losing Unit 2’s reliable electricity will be a major drain on New York’s grid, and will either raise emissions, energy prices, or more likely than not, both.

Unit 2 has a capacity of 1,028 MW, and Unit 3 has a capacity of 1,041 MW, enough to power nearly 1.5 million homes based on average household energy consumption in 2018, and the plants output for that year.  In 2018, 32 percent of New York State’s energy came from its six nuclear reactors. New York’s nuclear reactors are incredibly reliable, with an average capacity factor of 89 percent in 2017. In the same period, the capacity factor of the state’s hydro was 79%, and wind and solar were only 26% and 14% respectively.

Reliable baseload power is essential, especially for a state that is looking to increase its share of wind and solar, which are notoriously intermittent generation sources. The state also has serious natural gas supply issues due to pipeline projects being blocked and delayed, as well as due to its ban on hydraulic fracturing.

Both Indian Point reactors are currently operating on renewed licenses from the nuclear regulatory commission, and received their initial operating licenses in 1973 and 1975 respectively. The renewed license for Unit 2 was originally good until 2033 and Unit 3’s until 2035, but an agreement between Entergy, the company that owns Indian Point, and the New York state government resulted in their license terms being shortened to 2024 and 2025 respectively.

The decision by Entergy to shut the plant down was reached because of a combination of low energy prices, and expensive litigation with the state of New York.

New York Governor Andrew Cuomo, who has been a longtime critic of Indian Point, reached the agreement with Entergy has a long record of opposition to the plant, which he views as unsafe given its proximity to New York City. In his 2017 State of the State address, as he discussed the planned shutdown, he said, “I am proud to have secured this agreement with Entergy to responsibly close the facility 14 years ahead of schedule to protect the safety of all New Yorkers.” He has long viewed the plant as a safety hazard, but this is at odds with expert industry analysis.

The Nuclear Regulatory Commission continues to attest to the facility’s safety; it scored Green on all performance indicators in the fourth quarter of 2019, and remains in the Licensee Response column on the agency’s Action Matrix, the best possible position.

Cuomo’s view of Indian Point has more to do with his preference for a different energy future than it does with any real danger presented by the plant’s continued operations.

Indian Point provides 12 percent of New York State’s electric power. Because of this, it’s important to consider how that capacity will be provided once the plant is shuttered.

The main alternatives to Indian Point’s power in New York are either increased use of natural gas for electricity, expanded use of wind and solar technologies, or some combination of the two.

According to the Energy Information Administration’s annual short-term energy outlook, the lion’s share of the generation shift will likely be accounted for by increased use of natural gas. A projected increase of 11.5 billion kilowatt-hours from 2019 to 2020, with another additional 4 billion KwH from 2020 to 2021. They also account for an increase in the use of non-hydro renewables. An increase of .6 billion KwH from 2019 to 2020, and an additional 2.7 billion KwH from 2020 to 2021.

New York has major pipeline and supply issues which of late have been most publicly notable in the moratorium by provider National Grid on residential gas hookups because of short supply that ended in November when Gov. Cuomo threatened to revoke their license to operate unless they started accepting new customers. But although the moratorium is gone, the pipeline problems that preceded it continue. Wind and solar present their own issues in terms of land use and reliability. Getting rid of Indian Point is bad policy in terms of emissions, energy availability, levelized cost of electricity, or land use.

In his 2017 when the plan to close Indian Point was first announced, the Governor’s office claimed that, “Replacement power will be in place that adds no new carbon emissions and will have a negligible cost impact to ratepayers.” It is hard to see how this is possible when this will be replaced in large part by increased natural gas use, which although fairly low-emitting, will still be an increase from the non-carbon emitting nuclear capacity it’s replacing.

Replacing Indian Point by building wind and solar capacity poses possible land-use problems. As Robert Bryce pointed out in Forbes, “Replacing the 16 terawatt-hours of carbon-free electricity that is now being produced by the twin-reactor plant with wind turbines will require 1,300 times as much territory as what is now covered by Indian Point.” Wind and solar projects in the state often face significant pushback from their neighbors, and the space necessary to replace capacity lost by the closure of Indian Point could be a hard sell.

It also doesn’t make sense from the perspective of levelized costs of electricity.

Why prematurely get rid of built energy infrastructure for which the largest cost is upfront construction? According to the Institute for Energy Research’s 2019 study, “The Levelized Costs of Electricity From Existing Generating Resources”, already existing nuclear infrastructure provides the lowest cost per megawatt-hour of any generating source.

Closing nuclear plants like Indian Point, that have decades left in a safe operating life is a short-sighted policy. The costs of building new generation are far higher than those of diligently maintaining the existing energy infrastructure. New York will likely come to regret its fear-fueled abandonment of this reliable nuclear capacity.

The post New York is Wrong to Close Indian Point appeared first on IER.