By William Opalka
Exelon told New York regulators on Tuesday that it will close its Nine Mile Point Unit 1 nuclear plant next spring if the state has not guaranteed it a financial lifeline by September (16-E-0270).
The company announced its plans in a filing with the New York Public Service Commission in response to requests from commercial and industrial customers for more time to comment on an Exelon proposal for cost-based compensation for its nuclear plants. That proceeding is running concurrent with one on New York’s proposed Clean Energy Standard that includes a mechanism to compensate nuclear plants through zero emissions credits. (See New York Would Require Nuclear Power Mandate, Subsidy.)
Exelon supported the request to extend the comment deadline until July 15, after a June 24 PSC technical conference at which the company’s proposal will be considered. Exelon also wants a pricing formula determined by the PSC by Aug. 1.
The company has previously said that it would need financial support to keep its single-unit, 581-MW R.E. Ginna plant operating after a reliability support services agreement with Avangrid’s Rochester Gas & Electric expires next March.
In a filing in May, in which it proposed the compensation plan, Exelon also said it must “make immediate decisions” regarding the nuclear plants’ continued operation. But the Tuesday filing is the first time the company said it would not refuel Nine Mile Point in March.
Exelon told the PSC its Constellation Energy Nuclear Group could not count on a CES that is “merely speculative.”
“In order for CENG to make the investment and commitment necessary to keep Nine Mile Unit 1 and Ginna in operation, it needs the certainty provided by a commission order approving the CES and a signed contract procuring zero emission credits from the nuclear generators,” Exelon wrote. “CENG cannot simply roll the dice and make substantial investments on the hope that the program ultimately adopted by the commission is sufficient to justify the substantial investments and commitments required to enable continued operation of CENG’s upstate nuclear plants. Thus, CENG will need a contract in hand by September 2016. Time is of the essence.”
Exelon said refueling the unit would cost approximately $55 million, and while the process normally takes nine months to a year, it believes it can be compressed into six months.
The company just finished refueling Unit 2 at the plant. The two units, located on the shores of Lake Ontario, north of Syracuse, generate a combined 1,900 MW.
Nine Mile Point, Ginna and Entergy’s James A. FitzPatrick plant represent the entire upstate nuclear fleet that Gov. Andrew Cuomo wants to save to help the state meet its low-carbon emissions goals. Cuomo wants to exclude Entergy’s Indian Point plant, which he wants closed because of its proximity to New York City.
Under the CES, the zero emissions credits would provide extra compensation, similar to the way in which renewable energy projects receive additional payments for their clean energy attributes.
Entergy previously said it would close FitzPatrick and has not been swayed by the offer of a subsidy. (See New Lifeline for FitzPatrick Nuclear Plant.)