Aging nuclear power plants in New York uneconomic without bailout

Karl GrossmanBeyond Nuclear board of directors member Karl Grossman (photo, left) writes:

On Enformable today, my article on the New York State Public Service Commission yesterday approving a $7.6 billion bail-out of aging nuclear power plants in upstate New York under a "Clean Energy Standard" advanced by Governor Andrew Cuomo. He has pushed for continued operation of the plants and appoints the members of the PSC.

Grossman is the professor of journalism at the State University of New York/College at Old Westbury. Karl is also the author of Cover Up: What You Are Not Supposed to Know About Nuclear Power and other books on nuclear technology, as well as hosting numerous TV programs on the subject including "Chernobyl: A Million Casualties," "Three Mile Island Revisited" and "The Push to Revive Nuclear Power."

Update on August 3, 2016 by admin

Karl's article has also been published at The Ecologist.

Groups Criticize “Nuclear Mistake” Amid Praise for New York State’s Clean Energy Standard

Groups say state now responsible to ensure nuclear safety of the plants going forward

FOR IMMEDIATE RELEASE

August 1, 2016

Contact: Jessica Azulay, (315) 480-1515, jessica@allianceforagreeneconomy.org

Tim Judson, Nuclear Information and Resource Service, 212-729-1168, timj@nirs.org

Albany, NY – The New York State Public Service Commission today approved the “Clean Energy Standard” policy that puts into place a popularly-supported requirement that that utilities must buy increasing amounts of renewable energy, until the state meets its goal of 50% renewable energy by 2030. The proposal also includes an unpopular subsidy for economically struggling upstate nuclear power plants, the projected cost of which suddenly ballooned to almost $8 billion just three weeks ago.

The nuclear subsidies have drawn growing criticism and controversy with more than 15,000 people submitting comments opposed to nuclear subsidies and dozens of elected officials raising concerns.

When first proposed in January 2016, the Clean Energy Standard was mostly about supporting renewable energy and ensuring that New York would meet its goal of 50% renewable energy by 2030. A mandate that utilities buy renewable energy was approved today by the Public Service Commission and the move was praised by environmentalists across the state.

The Commission also approved a plan that promises nearly $8 billion dollars over 12 years to Exelon Corporation, the nation’s largest nuclear energy company, for its two struggling nuclear plants in upstate New York and for a third it is proposing to buy. This is twice the amount estimated to be invested in renewable energy through the Clean Energy Standard. The Indian Point reactors will become eligible to apply for subsidies in two years, and if they are included in the plan, the cost will soar to over $10 billion.

Jessica Azulay, Program Director with Alliance for a Green Economy, said: “Nuclear energy is not clean and it has no place in a Clean Energy Standard. We praise the Governor and the Commissioner for supporting renewable energy, but the nuclear subsidies are a mistake and a misuse of public money. These plants that will be kept open with this bailout are some of the oldest in the nation. They are dangerous and they should be shut down as soon as possible.”

Manna Jo Greene, Environmental Director of Hudson River Sloop Clearwater, said: “Today’s decision represents a $10 billion nuclear subsidy that will not being invested in renewables and energy efficiency. This means New Yorkers will no longer be able to choose 100% green energy, even if they want to. Unfortunately, the Public Service Commission is relying on the Nuclear Regulatory Commission’s lax oversight of aging failing nuclear facilities to protect public health and safety. This is a dangerous mistake.”

Tim Judson, Executive Director of the Nuclear Information and Resource Service, said: “Governor Cuomo is making New York the first to cave to Exelon’s outrageous demands and to waste billions of dollars on short-term nuclear bailouts instead of accelerating the transition to renewable energy that is necessary to address climate change. This should be a cautionary tale for other states because what started as an unnecessary, but relatively small subsidy scheme for nuclear reactors has, as we predicted, ballooned into at least a $7.6 billion nuclear bailout that dwarfs the state’s clean energy investment and ignores the vital role energy efficiency can and must play in the state’s clean energy future.”

Barbara Warren, Executive Director of Citizens Environmental Coalition, said: “Governor Cuomo and the PSC have just decided to prevent the closure of aging nuclear plants that continually have problems, like the recent leak at FitzPatrick a few weeks ago, which spilled oil into Lake Ontario. Now every incident or safety concern at those nuclear power plants will become a problem that the state is going to have to deal with. We will now expect and call on the Governor to help ensure safety at these plants.”

Nuclear Subsidies Approved Amidst Controversy and Growing Criticism

In recent weeks, over 100 organizations and dozens of elected officials have raised concerns about the nuclear subsidies. They have criticized the rushed process, the lack of consideration for alternatives, and the uncompetitive nature of the nuclear subsidies, which will go to only one company with no possibility for renewables or efficiency to replace nuclear plants, even if they are more affordable for consumers.

More than 15,000 people submitted comments in the case that opposed nuclear subsidies and supported renewable energy. This was compared to 3,600 that were submitted in favor of the nuclear subsidies, a 4 to 1 margin against.

The plan provides a guarantee of $56 per megawatt hour to nuclear operators, a cost that will rise every two years to $68 by 2027. By comparison, wind can be purchased in the Northeast for $44 per megawatt hour and energy efficiency costs only $25-40 per megawatt hour.

This means that instead of the $20 billion that consumers will now spend on buying power from and subsidizing the upstate nuclear plants, they could have purchased the same amount of energy from windmills for over 30% less money. Better yet, they could have invested in energy efficiency to eliminate the electricity demand supplied by nuclear plants for nearly half as much money.

Locking in the high electricity costs to subsidize nuclear power will place large and growing burdens on all electricity consumers in New York, from businesses to local governments and residential ratepayers. Low-income consumers could be the hardest hit, and local governments and school districts could be forced to cut already strained budgets further. Some local businesses, from manufacturers to hospitals, could see their power bills increase by six to seven figures per year.

The policy adopted by the PSC includes hypocritical and even perverse incentives for nuclear. The subsidies require operators to sustain extremely high levels of performance, which exceed top industry levels and that the New York plants have never been able to sustain. By penalizing Exelon for not meeting the performance standard, it encourages Exelon to postpone maintenance and to run the reactors with faulty equipment, which is both unsafe and counter to their long-term reliability. In addition, PSC based the subsidy rates on estimates of the social impacts of greenhouse emissions, but did not account for the cost of the extensive impacts of nuclear power and radioactive waste, many of which New Yorkers could have to bear.

In determining to include nuclear power in the “Clean Energy Standard,” the Public Service Commission failed to consider or even acknowledge the environmental harm and public safety concerns inherent in nuclear energy. These include massive radioactive waste produced during uranium fuel production, routine radioactive emissions, radioactive spills and leaks, nuclear accidents, and high level radioactive nuclear waste. Today’s decision also reversed a long-standing state policy that nuclear power reactors were not eligible for clean energy subsidies.

Background:

On Friday July 8th, the proposed subsidies for upstate nuclear plants in the NYS Clean Energy Standard jumped from $270 million to $7.6 billion, and a plan to lock in these subsidies for the next 12 years. Whereas the Indian Point reactors would have been barred under the previous plan, the proposal approved today opens a door for Indian Point to be included for subsidies. The plan approved today would put twice the amount of money into nuclear subsidies as it would toward renewable energy. The public was given only 10 business days to comment on the new version. Over 15,000 residents submitted comments and more than 100 organizations and elected officials submitted a letter asking a series of 8 crucial questions including questions about how this will increase electricity bills for residents across the state and if alternative plans for aggressively scaling up renewable energy with related jobs were considered. The groups noted in the letter that nuclear plants support just over 2,000 jobs, and that many of those jobs - approximately half - could remain for years to come during the lengthy shutdown process and dealing with the radioactive waste. Similar money in renewable energy and efficiency would create far more jobs. 

The groups also noted in the letter: “Regarding energy reliability and fossil fuel use, the New York Independent System Operator (NYISO), the agency responsible for ensuring a reliable electricity supply, has determined that the FitzPatrick and Ginna nuclear plants can shut down immediately with no reliability impacts and no need for new coal or gas power plants.”  An earlier letter to the Governor from over 100 organizations and small businesses challenged the justifications for the nuclear subsidies and offered alternatives to address concerns over job losses and greenhouse gas emissions.

Several NYS legislators have questioned the $7.6 billion subsidy to Exelon. NYS Assemblymember Amy Paulin, Chair of the NYS Senate Committee on Energy also submitted a letter to PSC Chair Zibelman asking thirteen questions of the nuclear subsidy on July 19th (copy and paste url link into browser): http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={36C022B1-510F-4EEB-8F83-0EEB5381D946}.

NYS Senator David Carlucci, a member of the Senate Energy Committee, sent a letter to Zibelman calling on the commission to deny the nuclear subsidy proposal and to consider alternatives, such as an agreement reached in California last month, to phase out nuclear facilities, replace them with renewable energy sources, and rehire nuclear workers for decommissioning and other utility operations. Sen. Carlucci also decried the characterization of nuclear power as “zero-emissions” and the PSC’s failure to consider its significant environmental impacts: http://mediad.publicbroadcasting.net/p/wrvo/files/Carlucci.pdf

NYS Assemblymember Ellen Jaffee Chair of the New York State Assembly Committee on Oversight, Analysis and Investigation voiced her opposition to the $7.6 billion subsidy and asked PSC Chair Zibelman to grant the NYS Legislature oversight in the subsidy and allow for the Legislature to have 60 days to publicly comment (copy and paste url link into browser): http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={2833F27E-0A93-4582-A204-8F9541161DC6}. Assemblymember Jaffee said: “The Public Service Commission’s new proposal to impose a nearly $8 billion nuclear tax on average ratepayers is unacceptable, largely out of public view, and is being pushed with undue haste... I am gravely concerned about this development in a case that was represented to be about supporting large-scale renewable energy, but in fact is now about a bill to subsidize the nuclear industry, an industry that is neither presently, nor has ever been, independently financially sustainable but rather relies on taxpayers’ subsidies.”

Politico NY: Cost, fairness of Cuomo's nuclear subsidy comes under scrutiny - http://www.politico.com/states/new-york/city-hall/story/2016/07/cost-fairness-of-cuomos-nuclear-subsidy-comes-under-scrutiny-104253

Jessica Azulay of Alliance for a Green Economy in Alternet: New York's Governor Would Rather Prop Up the Nuclear Industry Than Invest in Renewable Energy - http://www.alternet.org/environment/new-yorks-governor-andrew-cuomo-would-rather-prop-nuclear-industry-invest-renewable

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Update on August 2, 2016 by admin

The New York Times has reported on this story:

But some environmental groups, including the Alliance for a Green Economy in Syracuse, had opposed the subsidies, calling them possibly “the largest corporate bailout or subsidy” in state history.

Jessica Azulay, program director for the group, said it supported the governor’s push to mandate the purchase of renewable energy by utilities but thought subsidies that could amount to several billion dollars over 12 years were a big mistake.

“They’re dangerous, they’re aging, they’re unprofitable and they should close,” Ms. Azulay said of the nuclear plants.

The article's headline was a bit off, though: "New York State Aiding Nuclear Plants With Millions in Subsidies." Would that be a per day figure the headline is referring to? As the article's first sentence itself reports:

Utility customers in New York State will pay nearly $500 million a year in subsidies aimed at keeping some upstate nuclear power plants operating, regulators in Albany decided on Monday.

As AGREE's and NIRS's press release above reports, the four upstate NY reactors (FitzPatrick, Nine Mile Point 1 & 2, and Ginna) stand to gain $7.6 billion (billion with a B) over 12 years, at ratepayer expense. If Indian Point 1 & 2 get in on the action, as the NYS PSC final plan makes possible, that ratepayer bailout of NY nukes could top $10 billion.

NY: Manufacturers oppose proposed $7 billion nuclear power subsidy

As reported by Marie J. French in the Albany Business Review:

Big energy users, including large manufacturers in the state, oppose a plan to subsidize nuclear power plants that could cost as much as $7 billion...

The group, Multiple Intervenors, includes Alcoa (NYSE: AA), Corning (NYSE: GLW), Praxair (NYSE: PX), Wegmans Food Markets and State University of New York, according to its website.

"In New York’s apparent haste to appease the owners of selected nuclear generation facilities to ensure the continued operation of those facilities, customers are being exposed to potentially 12 years of artificially inflated and excessive subsidy obligations," the group wrote [in comments to the New York State Public Service Commission]...

Multiple Intervenors and other groups objected to the speed at which the nuclear subsidy is being pushed forward, as the proposal was first released July 8.

Update on August 1, 2016 by admin

As reported by multiple articles and press releases at Beyond Nuclear's "Nuclear Costs" website section, the NYS PSC disregarded these major manufacturers' objections, as well as those of other ratepayer advocacy organizations, environmental groups, etc. On August 1st, the NYS PSC, at Gov. Cuomo's strong urging, rubber-stamped the $7.6 to 10 billion nuclear bailout, at ratepayer (be it major manufacturer, small business, or household) expense.

Hinkley Point C in the U.K.: $50 billion radioactive white elephant stopped dead in its tracks?!

An article by Graham Ruddick in the Guardian, entitled "From feast to farce: how the big Hinkley Point C party was put on ice," reported that "the UK government was meant to be celebrating, but delays and second thoughts have left the project stalled."

The two new reactors at Hinkley Point C in Somerset, southwest England, would each be 1,600 Megawatt-electric French Areva European Pressurized Reactors (EPRs).

EPRs under construction in Finland (Olkiluoto 3) and France (Flamanville 3) are years behind schedule, and billions of dollars over budget. A major fabrication flaw in the reactors' lids and bases at those two projects may prove fatal, preventing completion and permanently blocking operation.

A proposed new EPR was blocked by an environmental coalition, including Beyond Nuclear, at Calvert Cliffs, Maryland several years ago. That major environmental victory, blocking the flagship EPR in the U.S., likely prevented a total of seven EPRs proposed across the U.S., from Nine Mile Point, NY to Callaway, MO. Additional proposed new EPRs under consideration at Darlington, Ontario were also rejected.

The Guardian article reports that, just two hours after the board of directors of Electricité de France (EDF) voted, by a narrow 10 to 7 margin, to proceed with building the Hinkley Point C nuclear power plant in the U.K., the new British prime minister's cabinet secretary in charge of the file, announced the British government would review the matter, and not announce its decision until early autumn.

The high-level confusion/international incident was illustrated clearly by the sudden departure of Chinese nuclear power industry investors, who had flown to Europe for the party celebrating EDF's decision, only to have the U.K. government pull the rug out.

The EDF board vote would have been 10 to 8, but an opponent of the project resigned in protest before the vote took place, citing the extreme risk of the proposal. The six labor union representatives on the EDF board voted as a bloc against proceeding with Hinkley Point C. Their position is that the top priority should be placed on safety repairs and upgrades at France's own current fleet of 58 aging atomic reactors, the second most of any country on Earth. (The U.S. has 100 operating reactors.)

Terry Macalister reported in the Guardian on July 7th that the estimated price tag for Hinkley Point C had risen to a whopping 37 billion British pounds, or nearly $49.5 billion U.S., at current exchange rates.

At a Beyond Nuclear sponsored presentation in Takoma Park, Maryland on July 21st, U.K. professor and solar power expert, Keith Barnham, reported that, at certain times of year, British taxpayers/ratepayers would subsidize 7/9ths of the cost of the electricity exported to France from Hinkley Point C, simply because the demand does not exist in the U.K. He pointed out the irony of going forward with such a U.K. subsidy of France, after the BREXIT vote removing the U.K. from the European Union. Barnham is author of The Burning Answer: The Solar Revolution, a Quest for Sustainable Power.

Update on July 29, 2016 by admin

Climate News Network also reported on this story. It was reprinted in EcoWatch. The article reports:

...[C]ritics of the controversial project were delighted. John Sauven, the executive director of Greenpeace, said: "Theresa May now has the chance to stop this radioactive white elephant in its tracks."

"She should look at the evidence and see that this deal would be a monumental disaster for the taxpayers and the bill payers. Countless experts have warned that for British families this power station will be terrible value for money," Sauven added.

Mycle Schneider, lead author of the World Nuclear Industry Status Report (just updated on July 13th), was interviewed by BBC, and expressed surprise at the sudden reversal regarding Hinkley Point C.

Update on August 1, 2016 by admin

The New York Times has reported that the British decision on Hinkley Point C has angered France and China.

Mark Jacobson: "Invest in clean energy, not nukes"

Mark Z. Jacobson (photo, left), a professor of Civil and Environmental Engineering and director of the Atmosphere/Energy Program at Stanford University, has written an op-ed in the Albany Times Union.

In it, he argues that the $7.6 billion bailout, at ratepayer expense, to prop up New York's upstate reactors (FitzPatrick, Ginna, and Nine Mile Point Units 1 & 2) would be much better invested in expanding solar and wind power, as well as energy efficiency. That would provide a 60% greater reduction in greenhouse gas emissions, and generate 82,000 net jobs, compared to NY Governor Cuomo's ill advised nuclear power bailout scheme. 

Jacobson wrote:

I was among many who were shocked by the Public Service Commission's proposal that the lion's share of the Clean Energy Standard funding would be a nuclear bailout. The plan, which the Public Service Commission may vote on as early as August 1st, would give three upstate nuclear plants an estimated $7.6 billion dollars in subsidies over the next 12 years. That's more than double what the proposal projects would go to renewable energy.

This does not make sense for a number of reasons. Allowing these three upstate nuclear plants to close now and replacing them with equal energy output from onshore wind and solar would be cheaper and would create more jobs.

Understand that the $7.6 billion to support the nuclear plants for just 12 years is a subsidy. After 12 years, another $11.9 billion is needed from the private sector to build wind farms to replace nuclear power. If, instead, the wind power sources were installed today, we avoid paying the $7.6 billion nuclear subsidy entirely and get a greater carbon dioxide reduction over the next 30 years, since wind turbines emit zero CO2 while spinning, whereas nuclear emits CO2 during its entire life due to the continuous mining and refining of uranium, an energy- and carbon-intensive process. Nuclear also emits heat from nuclear reaction directly and water vapor, a greenhouse gas, during cooling of the reactor, both enhancing the heat island effect to the local community and causing thermal pollution to the local water source.

On Feb. 2, 2016, NIRS hosted Dr. Jacobson, along with Dr. Arjun Makhihani of IEER, as well as Dr. M.V. Ramana of Princeton U. (a Beyond Nuclear advisor) for a telebriefing about the potential for renewables and efficiency to replace both fossil fuels and nuclear power. The telebriefing, "Paris Onward," took place after the successful conclusion of the COP21 (21st Council of Parties) climate agreement reached at the end of 2015 in France.

Update on August 1, 2016 by admin

As reported by multiple articles and press releases at Beyond Nuclear's "Nuclear Costs" website section, the NYS PSC disregarded Jacobson's warnings, as well as those of NY's major manufacturers, ratepayer advocacy organizations, environmental groups, etc. On August 1st, the NYS PSC, at Gov. Cuomo's strong urging, rubber-stamped the $7.6 to 10 billion nuclear bailout, at ratepayer (be it major manufacturer, small business, or household) expense.