Center for Environment, Commerce & Energy
Assembly Standing Committee on Energy
Assembly Standing Committee on Corporations, Authorities and Commissions
Potential Closure of Indian Point Energy Center (IPEC)
Examine the Impact of the Potential Closure of IPEC on New York's Economy and Electrical System, and Identify Alternatives to Offset or Replace Power Provided by IPEC
Assembly Hearing Room
Room 1923, 19th Floor
New York City
January 12, 2012
My name is Norris McDonald and I am the founder and president of the Center for Environment, Commerce & Energy (CfECE). CfECE was founded in 1985 and is a national, nonprofit organization dedicated to protecting the environment, promoting the efficient use of natural resources, enhancing human, animal and plant ecologies and increasing participation in the environmental movement. CfECE is based in Washington, DC with an office in China and a local New York office since 2001.
This written statement is being submitted to describe our support for IPEC and its importance to New York. CfECE believes that any substantial reduction in the amount of electricity generated by Indian Point 2 and 3 will spark demand for replacement electricity from nearby power plants. As production at these fossil-fuel plants increases, the air quality in and around these plants will further deteriorate, causing a spike in the incidences of respiratory and cardiovascular diseases in the communities where these plants are based.
CfECE has a longstanding interest in reducing air pollution and promoting public health in low-income and minority communities. CfECE seeks to include a unique voice in environmental policy decision-making and seeks to resolve environmental issues through the application of practical environmental solutions.
The Benefits of Indian Point 2 and 3
The Indian Point facilities, located in the affluent and predominantly white Westchester County, have a combined generating capacity of approximately 1910 MW. The facilities provide approximately 20-30% of the electricity for New York City and its northern suburbs. Because nuclear power is emission-free and has a demonstrated safety record, CfECE promotes the use of nuclear power. CfECE specifically supports the Indian Point 2 and 3 nuclear power facilities because these facilities provide significant electrical capacity to the State of New York with minimal human, animal, air, water, and land impacts.
Charles River Associates and Synapse/Riverkeeper/NRDC Reports
CfECE believes the Charles River Associates report more accurately reflects the energy reality for New York than the Synapse/Riverkeeper/NRDC report. The major weakness of the Synapse Report is its projections for renewables and efficiency in meeting New York's future electricity needs.
Some of the key findings of the Synapse Report include the following (with CFECE responses):
Energy efficiency resources, beyond those currently planned for, could provide as much as 1,570 MW of capacity savings in the Indian Point region, and additional savings are available in the rest of the state.
CfECE disagrees with this estimate. Electricity growth of 1 to 2 percent per year will cancel out this projected efficiency savings.
Renewable resources could also play a role in replacing Indian Point capacity, with roughly 1,154 MW of capacity available for reliability purposes already in the NYISO interconnection queue. To provide a conservative estimate of the amount of this renewable capacity that might likely be built and actually be available, we assume that only 50% of these projects are completed.
CfECE disputes this capacity estimate, most particularly because wind and solar projects, which have a capacity factor of about 30%, will always have to be backed up, usually with fossil fuel power plants.
In addition to the renewable resources currently in the NYISO interconnection queue, there is a large potential for rooftop solar and off-shore wind resources, most of which would be located within the regions near Indian Point and close to the high energy load centers.
There are not nearly enough rooftop solar potential near Indian Point. You could pave over the entire region with solar panels, including land area, and the 30% capacity factor would still require back up for electricity that is needed the other 70% of the time. The same physics apply to wind.
There is substantial potential for existing, older natural gas plants in New York City to be repowered or replaced with new efficient combined cycle power plants on the same site. If necessary, new, efficient natural gas combined cycle facilities could also play a role in replacing Indian Point capacity, and would be particularly helpful in providing dispatchable generation and voltage support in the Indian Point region.
CfECE supports combined cycle power plants. Unfortunately, there isn't much repowering going on and the same siting issues would be involved in the construction of new plants. Moreover, natural gas fired combined cycle power plants would still have emissions. We do not consider such a scenario to be a legitimate replacement for Indian Point.
New transmission lines, several of which are already in progress, can play a role in replacing Indian Point capacity, particularly transmission facilities that can eliminate the congestion between the Indian Point region and the rest of New York State.
New transmission lines between Indian Point and the rest of New York State are speculative at best. The only thing harder than siting a new power plant is siting new transmission lines. CfECE is not confident that such lines could be approved and constructed in a timely manner. The State of New York also does not want to become dependent on importing electricity from out of the state.
The costs of replacing Indian Point energy and capacity will depend upon the choice of replacement resources. Energy efficiency will help significantly reduce replacement power costs by reducing the wholesale prices of energy and capacity, and reducing customer bills. New renewable resources will help lower the cost of replacement power, to the extent that they are required anyway to comply with the state’s renewable portfolio standard.
The current cost of replacing Indian Point is approximately $10 billion. No utilities are stepping up to finance two new nuclear units in New York. Again, energy efficiency and renewables cannot replace the approximately 2,000 megawatts of baseload power produced by IPEC.
The CRA study overstates the likely costs of replacing power from Indian Point, by presenting a limited set of replacement options, especially a limited amount of energy efficiency opportunities.
The CRA cost estimates are reasonable. The CRA report deals with the reality that there are no cost effective ways to replace Indian Point. Again, the only baseload source of power that could replace IPEC is another nuclear facility. Even in such a circumstance, IPEC would still be needed to meet future demand over the next 20 years. The CRA report examined gas-powered replacement, which could lead to price spikes depending on the future availability of natural gas.
The percentage increase in electricity customers’ bills from replacing Indian Point will be roughly half of the percentage increase in wholesale electricity prices, because wholesale energy represents roughly half of electricity customers’ total bills.
Electricity customers' bills will rise to meet rising electricity demand. Replacing Indian Point, which is a great baseload asset, will add at least $10 billion to the customers' energy bills. Any such expenditure should go towards building two new reactors to supplement IPEC's output. CRA projects a 10% increase in wholesale electricity prices with a gas-fired replacement for Indian Point.
The impact on customers’ electricity bills is likely to be on the order of one to three percent under the scenarios discussed in this report. For those customers who participate in energy efficiency programs, this increase in electricity bills would be more than offset by reductions in bills due to energy efficiency savings.
This estimate is science fiction. Every municipality in the United States is facing significant double digit increases in utility bills, particular in areas that implemented a botched form of deregulation that restricted retail prices. Closing a facility that provides power to the equivalent of 2 million homes is not a prescription for keeping utility prices low. In fact, it is a definite prescription for creation significantly higher energy bills.
Charles River Associates
CfECE agrees with the key findings of the Charles River Associates report:
IPEC's retirement will increase the cost to New York's consumers under every feasible scenario.
IPEC's retirement without new generation or transmission system additions will compromise the reliability of the electricity grid.
Each option for replacement of IPEC's capacity would measurably increases air emissions.
The largest uncertainties are regulatory.
Action will be needed to assure the grid's reliability.
Energy conservation must be considered in a realistic context.
New replacement options may not be fully supported by market revenues; subsidies or contracts may be required.
Not all replacement options for IPEC's capacity may be available upon IPEC's scheduled retirement.
Gas-fired generation developed in the Lower Hudson Valley may be an attractive option, but with important tradeoffs and uncertainty.
Environmental Issues Caused By IPEC Closure
If Indian Point closes, it will create serious environmental issues. In New York City, it is estimated that there are 2,290 deaths, 1,580 hospitalizations, 546 asthma-related emergency room visits, 1,490 cases of chronic bronchitis, and 46,200 asthma attacks yearly attributable to power plant pollution. The New York City area has also been ranked as one of the top five U.S. metropolitan areas for particulate air pollution.
The Indian Point 2 and 3 facilities, located in the affluent Westchester County, have a combined generating capacity of 1910 MW. The facilities provide approximately 20-30% of the electricity for New York City and its northern suburbs. And, unlike New York’s fossil-fuel burning facilities, Indian Point 2 and 3 do not pollute the air. Closure of Indian Point will exacerbate compliance with the federal Clean Air Act State Implementation Plan (SIP) for the State of New York. Such SIP-call noncompliance can lead to a loss of federal highway funds and other federal sanctions. In addition to providing electricity for homes, businesses and agencies, the most important aspect of the Indian Point nuclear facility is that, while doing this, it does not contribute to asthma in the New York metropolitan area. For asthmatics, particularly in overly polluted minority areas, the value of the Indian Point facility is priceless. Emission-free nuclear power is a godsend for asthmatics during the summer. Emission-free electricity also protects healthy people who have not developed asthma.
CfECE submits the following issues for consideration by the Standing Committee(s):
(1) Whether the Standing Committee is considering all adverse environmental impacts if Indian Point 2 and 3 close, including air impacts on communities?
(2) Whether the Standing Committee intends to consider the negative impacts on air quality in communities, which will result from any substantial reduction in generation at Indian Point 2 and 3?
(3) Whether the failure to consider all adverse environmental impacts in an IPEC closure, including air impacts in communities, renders any support for closure unsupportable?
CfECE’s issues are substantive and one fact is irrefutable: Nuclear produced electricity reduces smog. The New York City Metropolitan Area, including Westchester County and the Northeast corridor are very large nonattainment areas that violate Clean Air Act standards. An additional benefit of Indian Point is its reduction of greenhouse gases that contribute to global climate change. Global warming creates a more toxic smog and poison runoff from impervious surfaces. CfECE is promoting a campaign to combine nuclear power with electric and hybrid vehicles as a methodology for aggressively mitigating smog.
Air Pollution Causes Serious Adverse Health Effects
In 1999, coal-fired power plants in the United States emitted into the environment 11.3 million tons of sulfur dioxide (“SO2”), a criteria air pollutant that is correlated to asthma and impaired lung functions, 6.5 million tons of nitrogen oxides (“NOx”) which, when combined with ozone, volatile organic chemicals and sunlight, forms smog, a lung irritant linked to asthma, and 1.9 billion tons of carbon dioxide (“CO2”), yet another contributor to increased smog levels. This equates to approximately 60% of all SO2 emissions, 25% of all NOx emissions, and 32% of all CO2 emissions nationwide.
These and other airborne pollutants emitted by fossil-fuel power stations may have a direct and significant effect on human health. In a study by Abt Associates, one of the largest for-profit government and business research consulting firms in the world, it was found that over 30,000 deaths each year are attributable to air pollution from U.S. power plants. Another study found that air pollution from power plants was a contributing factor to higher infant mortality rates and higher incidences of Sudden Infant Death Syndrome (“SIDS”). Research has further shown that pollutants from fossil-fuel power plants form tiny acidic particles (called fine particulate matter) that are linked to diseases of both the respiratory and cardiovascular systems. Not surprisingly, air pollution has been characterized as one of the largest threats to public health.
New Yorkers Pay Negative Health Effect Price for Air Pollution
In New York City, it is estimated that there are 2,290 deaths, 1,580 hospitalizations, 546 asthma-related emergency room visits, 1,490 cases of chronic bronchitis, and 46,200 asthma attacks yearly attributable to power plant pollution. The New York City area has also been ranked as one of the top five U.S. metropolitan areas for particulate air pollution.
Increasing Generation at Facilities Near Indian Point Will Increase Air Pollution in the Communities Where These Facilities Are Based
An August 2002 study by the TRC Environmental Group entitled, Entergy Nuclear Indian Point 2, LLC and Entergy Nuclear Indian Point 3, LLC Emissions Avoidance Study (the “TRC Report”), found that, if Indian Point is brought offline, the air quality in New York will decrease dramatically. For instance, if the gap created by Indian Point’s closure were to be filled by the power plants located in New York City, CO2 plant emissions would increase by 101% (or 12,494,172 tons), SO2 plant emissions would increase by 106% (or 8,020 tons), and NOx plant emissions would increase by 105% (or 16,107 tons). Even if replacement electricity were spread out more broadly, to include all of the Hudson Valley and New York City plants, CO2 plant emissions would still increase by 57% (to 13,686,648 tons), SO2 plant emissions would increase by 62% (to 35,961 tons), and NOx emissions would increase by 57% (to 20,258 tons).
As the level of air pollution increases, so do the incidences of death and respiratory and cardiovascular ailments. For instance, in the National Morbidity and Mortality Air Pollution Study (“NMMAPS”), a team of investigators from Johns Hopkins University and the Harvard School of Public Health found, among other things, strong evidence linking daily increases in particle pollution to increases in death in the largest U.S. cities. Links have also been found between fine particle levels and increased hospital admissions for asthma, cardiovascular disease, pneumonia, and chronic obstructive pulmonary disease. Stated bluntly in the Air Quality in Queens County Report, “Epidemiological studies tell us that on days when air pollution levels are high, more people get sick or die.”
Based on the above data and studies, it is clear that if Indian Point 2 and 3 were to be brought offline, forced to close, or if their production were limited, the void in electricity production would be filled by polluting power plants with a corresponding increase in the rates of asthma and other respiratory diseases, cardiovascular diseases, and even infant mortality in these communities.
The Indian Point facilities, located in the affluent and predominantly white Westchester County, have a combined generating capacity of approximately 1910 MW. The facilities provide approximately 20-30% of the electricity for New York City and its northern suburbs.
Because nuclear power is emission-free and has a demonstrated safety record, CfECE promotes the use of nuclear power. CfECE specifically supports the Indian Point 2 and 3 nuclear power facilities because these facilities provide significant electrical capacity to the State of New York with minimal human, animal, air, water, and land impacts.
 See Death, Disease & Dirty Power: Mortality and Health Damage Due to Air Pollution from Power Plants, at 24, Clean Air Task Force (October 2000).
 See New York’s Dirty Power Plants, Clear the Air – the National Campaign Against Dirty Power.
 See Rachel H. Cease, Adverse Health Impacts of Grandfathered Power Plants and the Clean Air Act: Time to Teach Old Power Plants New Technology, 17 J. Nat. Resources & Envtl. L. 157, 158 (2002-2003); Martha H. Keating, Air Injustice, at 4 (October 2002) (attached hereto as Exhibit B).
 17 J. Nat. Resources & Envtl. L. at 158.
 Id. at 159.
 See Martha H. Keating, Air Injustice, at 3 (October 2002).
 See id. at 4. See also Air Quality in Queens County: Opportunities for Cleaning Up the Air in Queens County and Neighboring Regions, at S-6, Synapse Energy Economics, Inc. (May 2003) (“Air Quality in Queens County”) (“Epidemiological studies tell us that on days when air pollution levels are high, more people get sick or die.”) (available at http://www.synapse-energy.com/Downloads/Synapse-report-queens-air-quality-exec-summary-05-29-2003.pdf); Children at Risk: How Pollution from Power Plants Threatens the Health of America’s Children, at 2, Clean Air Task Force (May 2002) (“Power plant emissions and their byproducts form particulate matter, ozone smog and air toxics. These pollutants are associated with respiratory hospitalizations, lost school days due to asthma attacks, low birth weight, stunted lung growth and tragically, even infant death.”) (available at http://cta.policy.net/fact/children/).
 Allison L. Russell, Urban Pollutants: A Review and Annotated Bibliography, at 3, New York City Environmental Justice Alliance 2000 (available at http://www.nyceja.org/pdf/Urban.pdf).
 See Death, Disease & Dirty Power: Mortality and Health Damage Due to Air Pollution from Power Plants, at 24, Clean Air Task Force (October 2000) (“Death, Disease & Dirty Power”) (Exhibit C) (available at http://cta.policy.net/fact/mortality/mortalitylowres.pdf).
 See New York’s Dirty Power Plants, Clear the Air – the National Campaign Against Dirty Power (available at http://cta.policy.net/relatives/17841.pdf). The Air Quality in Queens County Report states that “New York City … [is] burdened with significant air quality problems” and “[t]he US EPA has determined that the NY metropolitan area … is in ‘severe nonattainment’ for ozone.” Id. at S-5.
 Cited in Death Disease & Dirty Power, at 14.