Thursday, January 12, 2012
Vision for Affordable Energy Even if Indian Point Nuclear Plant Is Shut Down
If anyone, or any business, can get a good deal on electricity, it ought to be Consolidated Edison, which buys loads of it every year and then sells it to three million customers in New York City and the suburbs. Like most traditional utility companies, it has gotten out of the power generation business in recent years and is now a distribution company. It buys the electricity that it delivers from generators run by independent companies.
So when Con Ed goes shopping, where does it find the best prices?
The question came up Thursday at a legislative hearing in the city on the future of the Indian Point nuclear power plant, which Gov. Andrew M. Cuomo wants to close. Whether he succeeds or not, the action will be a pivot in the history of New York City. The state has plenty of relatively cheap and clean electricity from hydropower and wind farms, but it is trapped in the northern reaches of the state by a distribution system that hits a traffic jam of electrons before it gets near the city.
Indian Point, however, is in Westchester County, south of that congestion, and its electricity flows without obstacles into the city, just about 30 miles away. That very geography is also driving the effort by the governor and others to close the plant, which is getting old.
There is little confidence that people would be able to evacuate the region, much less the most densely populated big city in the country, in the event of a serious accident. (A leak of radioactive water in a cooling pump forced the plant to shut down one of its two generators this week.)
If the plant closes in the next few years, the 2,000 megawatts of electricity that it produces will have to come from somewhere else — that is, somewhere either in or near the city. Business and union officials spoke Thursday, as they have before, in support of the continued operation of Indian Point, arguing that the economy would be hobbled by the loss of so much cheap electricity.
Interestingly, the current electricity prices are kept secret by the generating companies and the utilities.
But by poring through Con Edison’s annual reports, James F. Brennan, a Democratic member of the Assembly from Brooklyn who also represents the Working Families Party, managed to figure out the prices it paid in 2010 to four of its leading suppliers.
Here are the numbers Mr. Brennan found for each kilowatt hour:
¶ 12.8 cents, from a wholesale market based in Albany.
¶ 8.2 cents from a gas-fired power plant in Astoria, Queens.
¶ 7.7 cents from the Indian Point nuclear generators.
¶ 6.8 cents from a gas-powered co-generation plant operated in the Brooklyn Navy Yard.
Mr. Brennan thinks that New York can get by without the electricity generated by Indian Point and that the city will not be putting itself at a financial disadvantage. Other cities actually make their own electricity, and do so at lower costs than some commercial suppliers, he noted at the hearing. Asked by a city official if he thought that the city should get into that business, Mr. Brennan paused for a minute. “Yes,” he said.
Certainly, the cost of making electricity has declined drastically in the last few years, in large part because the price of natural gas has been dropping. The decrease in price has made electricity from natural gas competitive with nuclear power. In 2008, the price of natural gas was $12 or $13 for a quantity known as a decatherm.
“Right now, it is $3 for a decatherm,” said Joseph P. Oates, a vice president at Con Edison.
Newer gas-generating plants are far more efficient than the ones they are replacing, and the city has helped developers build new ones in Queens. Con Edison, which used to own Indian Point, does not have a position on the continued operation of its old plant, but Mr. Oates said: “If you close it, it has to be replaced with something. The question is, what is that something?”
Natural gas plants have low emissions, but Norris McDonald, the president of the African American Environmentalist Association, said during a break in the hearing that Indian Point had virtually no emissions. “Where it is now, it is an environmental asset,” he said. “If you shut it down, whatever you’re going to replace it with is going to increase emissions in communities like Harlem.”
Other environmentalists argue that much of the slack can be made up with a combination of greater efficiency and more renewable energy, like solar, wind and tidal power. But when?
A wise colleague once gave me a warning on another dense topic: If you think you understand the problem, he said, then it hasn’t been properly explained to you.