Entergy said Monday it will shut down its Indian Point Energy Center by 2021, citing declining revenue and increased operating costs at the New York nuclear plant, which has been at the center of a controversy concerning bolt degradation.
The utility plans to shut down the Unit 2 reactor in April 2020, followed by Unit 3 in April 2021, dates that are respectively 13 and 14 years earlier than their Nuclear Regulatory Commission licenses require. Unit 1 ceased production in October 1974 after the emergency core cooling system failed to meet regulatory requirements. The 2,000-megawatt power plant is located 25 miles north of New York City.
As part of a settlement with the state, Entergy will pay New York $15 million in environmental and community aid; in turn, New York officials have agreed to drop legal challenges the company’s pursuit to renew NRC operating licenses for the reactors.
Entergy said record low natural gas prices, driven primarily by the Marcellus Shale formation supply, have forced power prices down by 45 percent, or $36 per megawatt-hour, across the country in the past decade. A $10 per megawatt-hour drop in power prices lowers annual revenue by about $160 million for Indian Point and similar nuclear plants, according to the company.
“Key considerations in our decision to shut down Indian Point ahead of schedule include sustained low current and projected wholesale energy prices that have reduced revenues, as well as increased operating costs,” Entergy Wholesale Commodities President Bill Mohl said in a statement. “In addition, we foresee continuing costs for license renewal beyond the more than $200 million and 10 years we have already invested.”
Operational costs have increased, in part, due to the discovery of baffle-former bolt degradation at Indian Point. Entergy’s special inspection of Unit 2 in March found that 227 of the plant’s 832 baffle-former bolts were broken, degraded, or missing. These stainless-steel bolts help channel cooling water through active nuclear fuel rods and prevent them from overheating. The bolt degradation has been regarded as a critical safety issue, fueling calls from lawmakers and residents tor Entergy to close the plant.
Entergy, which has since replaced Unit 2’s failed bolts, performed the inspection in response to demands from New York Attorney General Eric Schneiderman’s environmental office, which has filed dozens of contentions on Indian Point with the NRC’s Atomic Safety and Licensing Board since 2007.
