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 to the company’s pursuit of renewed NRC operating licenses for the reactors.
Entergy said record low natural gas prices, driven primarily by supply from the Marcellus Shale formation, 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 2016 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.
Entergy spokeswoman Patricia Kakridas said 928 used fuel assemblies from Indian Point Units 2 and 3 have been moved from spent fuel pools and loaded into dry storage casks on the site storage pad. For unit 1, 160 used fuel assemblies have been loaded into dry storage. She added that there are 1,157 assemblies in the Unit 2 spent fuel pool, and 1,103 assemblies in the Unit 3 spent fuel pool.
Since the discovery of bolt degradation issues at Indian Point, PSE has also found degraded bolts in its Unit 1 reactor of its Salem Nuclear Power Plant in New Jersey.
The NRC, in a June blog post, said it is “confident this issue lacks an immediate safety concern that would lead us to shut down U.S. nuclear power plants or prevent the startup of plants in refueling outages.” Degraded baffle-former bolts were first detected in French reactors in the late 1980s and 1990s.
“For 15 years, I have been deeply concerned by the continuing safety violations at Indian Point, especially given its location in the largest and most densely populated metropolitan region in the country,” Gov. Andrew Cuomo said in a statement. “This administration has been aggressively pursuing and incentivizing the development of clean, reliable energy, and the state is fully prepared to replace the power generated by the plant at a negligible cost to ratepayers.”
Cuomo’s Clean Energy Standard includes the goal of sourcing 50 percent of New York with clean, renewable energy by 2030.
Schneiderman, in a separate statement, said Indian Point’s closure is the culmination of work his office has completed in addressing health and safety risks surrounding the New York plant.
Entergy has also cited economics in its decisions in recent years to shut down four other nuclear power facilities: the James A. FitzPatrick Nuclear Power Plant in New York (which has tentatively been sold to Exelon and could remain in operation), Pilgrim Nuclear Power Station in Massachusetts, Vermont Yankee Nuclear Power Plant, and the Palisades Nuclear Power Plant in Michigan.
Nuclear Energy Institute President and CEO Maria Korsnick weighed in on the Indian Point closure Monday, painting an optimistic picture for nuclear plants in the United States.
“As unpleasant as it is to see the business decision that Entergy has been forced to make in an era of sustained, record-low natural gas prices, we are seeing increased recognition of nuclear energy’s value,” Korsnick said, citing energy legislation passed in both New York and Illinois, staving off several other nuclear plant closures. “More must be done—with urgency—to preserve financially challenged nuclear plants in other states, but momentum is building.”
