The other Indian Point debate: the cost of energy

Few issues are as divisive for Hudson Valley residents as the fate of Indian Point Energy Center in Buchanan. Located within a 50 mile radius of the country’s most vibrant city and millions of residents, there are environmental and safety issues to consider. Here, though, I will touch on the Indian Point debate only as it relates to local energy costs.

I wrote in today’s Westchester County Business Journal about two separate setbacks that Indian Point owner Entergy Nuclear has experienced over the past couple of weeks in the company’s efforts to re-license the plants (the current licenses for IP2 and IP3, the two active reactors, expire in 2013 and 2015, respectively).

One of those two items I reference was a joint statement released by state Assemblymen Kevin Cahill and James Brennan, chairmen of the Committee on Energy and of the Committee on Corporations, Authorities and Commissions, in which the two conclude that based on testimony at a Jan. 12 hearing, Indian Point could be shut down “without unduly burdening New York’s ratepayers or the electric system,” in Cahill’s words.

The problem: that might not be the case. Jerry Kremer, chairman of the New York Affordable Reliable Electricity Alliance, said in response to Cahill and Brennan’s statement:

“I testified at the January 12 hearing and heard compelling evidence throughout that day from the New York Independent System Operator, Con Edison, and Charles River Associates (an independent energy consulting firm) that the loss of Indian Point would have serious ramifications on the City’s electric costs and reliability…

“It seems the committees, both chaired by known opponents of Indian Point, were using the January 12 hearing to justify pre-established positions rather than to look informatively at this important issue.”

Kremer is absolutely right and justified in saying that several experts who testified at the hearing spoke to the importance of Indian Point as a major provider of electricity to the region and as a vital link in the state’s electric grid between the upstate power generating sources and downstate consumers. It seems that in their conclusion, Cahill and Brennan chose to ignore this particular testimony.

The bottom line is this: whether or not you are a fan of Indian Point, there have been credible studies and evidence to support the theory that electricity costs would go up significantly if the plants are shut down without a source (or sources) of replacement power already in operation. Those replacement power sources, let me remind you, will not appear overnight. It is extremely difficult to secure the permits and approvals necessary to build a power plant; not to mention the time and financing that would be inherent in any such project.

Turning a blind eye to safety issues is reprehensible, agreed. But turning a blind ear to the economic facts – which Assemblymen Cahill and Brennan apparently did – is disturbing in its own right.

Advertisements

Happy Monday Morning! Report – the Week Ahead:

> In the, “We have to get this news item out of the way” category:

  • METRO NORTH WILL RESUME SERVICE AT 2PM, WILL RUN ON A SUNDAY SCHEDULE.
  • Over 100,000 Con-Edison customers without power; company expects power to be restored by Thurs. Sept. 1 at the latest.
  • Reports indicate Sound Shore, Saw Mill River area hardest-hit in Westchester County.
  • Early estimates put Irene damage at $7 billion, according to the New York Times, with insurance companies being hit with an estimated $2.6 billion in costs.
  • The A.M. Best Co. has estimated disaster-related losses from 2011 at $27 billion through June 30 (so figure much higher when you include damage incurred since), making this year one of the costliest in recent history.

> Consumer spending in the U.S. increased by 0.8% in July (after falling by 0.1 percent in June), marking a major turn-around and a positive sign for the economy. Economists had expected gains of 0.5%.

> Personal income data, housing index and manufacturing index due out this week – stay tuned.

> In the coming weeks, the Business Journal will be closely following Gov. Cuomo’s Regional Economic Development councils and the newly-launched “NY Open for Business” campaign; check back here for more analysis as those stories develop.

Will quake fuel Indian Point debate?

Look for the 5.9 earthquake that hit near Richmond, VA, today to give momentum to environmental groups and politicos calling for Indian Point to be shut down.

Energy-sector leaders, from Entergy Nuclear to solar panel installation firms to utilities providers have said that shutting down Indian Point will lead to skyrocketing energy prices for New Yorkers.

That said, I would be shocked if the anti-Indian Point camp didn’t make a strong push in light of the east coast quake (aside – look for Fox News to really capitalize on this turn of events with some corny headline “Earthquake 2011: It’s all Obama’s Fault”) to renew calls for the plant’s shutdown. Will the Nuclear Regulatory Commission be swayed?