Monday, November 2, 2015

Closing of FitzPatrick nuclear power plant in New York not bad news for everybody

It's always disappointing to hear of people losing their jobs and particularly so for nuclear advocates when the shuttering of another plant is announced - which is the case this morning.

Entergy to close FitzPatrick nuclear plant in Oswego County
SCRIBA, N.Y. – Entergy Corp. plans to shut down its money-losing FitzPatrick nuclear power plant in Oswego County after the reactor runs out of fuel next year.
Entergy officials called a meeting of employees today to announce that the company will not install more enriched uranium fuel rods next September, which would be required to continue operating the facility.
Barring some unexpected intervention by state officials, the 850-megawatt facility will shut down in late 2016 or early 2017 and begin laying off its 615 employees.
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I was reviewing some statistics from Canada's National Energy Board the other day, and the shuttering of generators in New England looked to be reflected in the value of exports out of Quebec.

The closure of Vermont Yankee is almost surely price positive for Hydro Quebec (HQ) as will be announced closures of Oyster Creek (New Jersey), Pilgrim (Massachusetts), now Fitzpatrick (New York) and likely Ginna shortly thereafter (New York) all bode well for Quebec - particularly as coal-fired power plants are also closing.

An accelerated closure of Ontario's 3000 megawatt Pickering nuclear power plant, which likely has higher cost than all of the shutting American plants, could easily push HQ export pricing beyond the high cost gas days of 2008 - before the recession.


Entergy News Room: Entergy to Close James A. FitzPatrick Nuclear Power Plant in Central New York
... despite good operational performance, market conditions require us to also close the FitzPatrick nuclear plant"

The decision to close the FitzPatrick plant was based on the following factors that make it no longer economically viable:
· Sustained low current and long-term wholesale energy prices, driven by record low gas prices due to the plant's proximity to the Marcellus shale formation, have reduced the plant's revenues. Current and forecast power prices have fallen by about $10 per megawatt-hour, which equates to a projected annual loss of more than $60 million in revenues for FitzPatrick.
  • Flawed market design fails to recognize or adequately compensate nuclear generators for their benefits. FitzPatrick and other nuclear power generators provide a key fuel diversity benefit with significant climate-related advantages. In addition to generating virtually carbon-free electricity, nuclear plants offer onsite fuel storage, maintain grid reliability and serve as a significant source of large-scale 24/7 energy generation.
  • The plant carries a high cost structure because it is a single unit. Entergy has already invested hundreds of millions of dollars to improve FitzPatrick's reliability, safety and security. While the company will always make investments needed to assure safe operations, it considers the long-term financial viability of operating plants in markets that ignore the benefits of nuclear power.
  • The locational constraints reduce the plant's revenues. The region has excess power supply and low demand.
This next quote I'll need to editorialize on as I made this comment on a Facebook group requiring Governor Cuomo's position prior to the closure announcement: "I interpreted his past comments as positioning to blame Entergy for the pending closure. The fact a guy wants unprofitable plants to keep operating and profitable ones to close says something about the guy, but it tells us nothing about the level of desire to keep Fitzpatrick operating."

NY to lose one of its six nuclear plants; Cuomo vows legal fight
"The closing of the James A. FitzPatrick Nuclear Power Plant will devastate the lives of the more than 600 employees and their families. Good corporate citizenship must appreciate that there are many factors that count as the 'bottom line,'" Cuomo said in a statement. "The state of New York will pursue every legal and regulatory avenue in an attempt to stop Entergy’s actions and its callous disregard for their skilled and loyal workforce.”
Oh the indignation.

There's more. From Senator Schumer.

Schumer 'furious' with Entergy over FitzPatrick nuclear plant closing
WASHINGTON, D.C. – U.S. Sen. Charles Schumer is "furious" with Entergy Corp. over its decision to close the James A. FitzPatrick nuclear power plant in Oswego County, and plans to appeal today to the company's chief executive to find a way to keep the plant operating.
Schumer was not involved in those negotiations and, like Cuomo, made no public appearances with FitzPatrick plant supporters or Oswego County officials to discuss Entergy's pending decision.
Schumer, who visits Central New York at least once a month for news conferences, did not discuss the FitzPatrick plant with local reporters until an unrelated appearance in Syracuse today regarding the outbreak of Legionnaire's disease...


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