By William Opalka
New York electricity customers would pay about $1.7 billion more annually over the next decade if the nuclear fleet operating on Lake Ontario shuts down, according to a new study by The Brattle Group.
The report, released Dec. 7, was prepared for three unions representing utility workers and building tradesmen in western New York.
The backdrop is the proposed shutdown of Entergy’s James A. FitzPatrick plant and the eventual closing of the R.E. Ginna plant, owned by Exelon, when a contract providing ratepayer subsidies runs out in 2017. (See Entergy Rebuffs Cuomo Offer; FitzPatrick Closing Unchanged and Ginna Lifeline to End in 2017; Profits After ‘Unlikely’.)
Also included in the study is Exelon’s two-unit Nine Mile Point. The company has not indicated that the plant is in danger of closing but said its environmental attributes need to be recognized in the design of the wholesale market.
Nuclear supporters are trying to keep the plants running. Gov. Andrew Cuomo also has some ideas on how to keep the plants operating for the next 15 years for their air emissions benefits while New York transitions to more renewable and distributed energy in its power system. Details could be released at Cuomo’s State of the State address in January.
The three plants, with four reactors, have a combined generating capacity of 3,345 MW. They represent 7% of NYISO’s capacity but 15% of its electricity production.
The study said the plants lower wholesale electricity prices and mitigate the state’s ever-increasing reliance on natural gas for power generation. Without upstate nuclear, natural gas’ share of generation would rise from the current 40% to 54%, it said.
“This alternative generation mix would mean higher average electricity prices in New York, driven in part by energy market effects, but perhaps more importantly by the effect on NYISO capacity markets,” the study said. The power plants contribute approximately $3.16 billion to the state’s gross domestic product, account for nearly 25,000 full-time jobs (direct and indirect) and provide other benefits, such as avoiding 16 million tons of carbon dioxide emissions annually, according the report.
The plants also contribute $144 million in net state tax revenue annually, including more than $60 million in state and local property taxes.
The report was prepared for the International Brotherhood of Electrical Workers’ Utility Labor Council of New York, the Rochester Building & Construction Trades Council and the Central-Northern New York Building & Construction Trades Council.