My Electric Market Price And Innovative Technology Formation

The price formation I am talking about is like with the 1930s coal plants that are still on the line. We don't or didn't have adequate incentives to knock these off the market because they were too old. If the power companies fully updated them, they would have to comply with new environment regulations everyone else has to comply with. You barely maintain them...basically these obsolete plants block the introduction of new technology. 

This is basically going on in the nuclear industry. Do you really want the average fleet age of 60 years old nuclear plants. 

Basically the Forbes articles have a severe ideological till to them all. This is our property and we do what we want with it, we sabotage all of our competitor no matter even if we have to cheat. It is egotism run riot!!!  

If No One Wants The Fitzpatrick Nuclear Power Plant To Close, Why Is It Closing?

Nov 10, 2015 @ 06:00 AM 364 views

James Conca ,

Last week, Entergy Corporation announced it will prematurely close its Fitzpatrick nuclear power plant more than 20 years ahead of schedule, which the company says will save it $250 million. The State of New York says closing the plant will cost the state $500 million and devastate the local community. The loss of carbon-free emissions is closer to $3 billion.

Almost every constituency and politician involved says they really don’t want the plant to close, including the utility itself,the local community, the Governor of New York, the New York Representatives,the New York Senatorsand the Obama Administration. 

So why can’t something be worked out?

The local government is more than just worried. The average FitzPatrick worker earns about $120,000 a year, a huge number in a county where the median household income is only $48,000.

The real reason for Fitzpatrick’s closing, like other recent nuclear plant closings, is the transient warped energy market structure of the unregulated merchant markets, especially in the north and east.

In these competitive electricity markets, prices are lower than they should be because the rules and operations of the marketplace are not capable of capturing everything that should be included in the price. This is known as price formation and the Federal Energy Regulatory Commission is trying to fix this.

But it maybe too little too late for many nuclear plants.

Judge Gregg has always been a severe ideologue and a destructive nuclearist. A 1%er supporter. 

Former Senator Judd Gregg (R-NH) told me just yesterday at the annual meeting of the American Nuclear Society in Washington D.C., that there are about 20 single-unit nuclear plants at risk of premature closing. Their total electricity output is equivalent to the country’s entire renewable energy output. If they close, we will spend twenty years just trying to replace that much emission-free generation.

According to Entergy, the decision to close the Fitzpatrick plant was based on the following factors: 

- Sustained low wholesale energy prices. Record-low natural gas prices from proximity to the Marcellus shale formation have caused power prices to fall $10 per megawatt-hour, costing Fitzpatrick more than $60 million in revenues per year. 

- Flawed market design. The market fails to recognize or adequately compensate nuclear generators for their benefits such as reliability and being emission-free. FitzPatrick and other nuclear power generators provide grid stability and reliability. They serve as a

All I what is new technology and new facilities to serve our common good of grid stability and reliability. 

significant source of large-scale energy generation 24/7, especially during extreme weather conditions like a polar vortex or times of extreme heat.

- Nuclear is never included in clean-energy mandates and doesn’t get the types of

I believe in building new new nuclear plants they'll get clean-energy mandate. Just old dinosaur and  unsafe plants we want replaced. 

subsidies or production tax credits that renewables get.

- The Fitzpatrick plant carries a high cost structure because it is a single unit, like the

The high cost structure are totally in the control of these large utilities. Why always default to site and cost structures of the 1960s and 1970s? If it is one off plant like Fitz, you replace the old site with a multi-unit new site and highly standardized units. Better, you build the plant 4 times the size of our current plants and use half the employees and maintenance of the current base. Highly computerize the units. You invent something nuclear more efficient and new that dazzles us all...that blows away all the competitors with price. That is how you serve out common good...  

other plants recently closed and those at risk of closing. Most nuclear plants come in two’s or three’s, making for positive economies of scale.

However, more than just a mere $250 million is at stake. The Fitzpatrick power plant produces over 7 billion kWhs of carbon-free electricity a year at only 5¢/kWh (actual production costs, although the price is determined by the market and includes other costs like transmission and infrastructure). Closing the plant prematurely loses 150 billion kWhs of carbon-free electricity over the next 20 years, electricity that will be replaced primarily with natural gas, not renewables.

Together with the premature closing of the Vermont Yankee, Pilgrim, and Kewaunee nuclear plants for similar reasons, these closings have negated the construction of the last 20,000 large wind turbines from an investment of over $40 billion. This is more than all the wind power in California. That much wind power is supposed to replace coal, but instead will go to just replacing the carbon-free power we’re losing from closing these four nuclear plants.

New York Governor Andrew Cuomo says he wants to keep Fitzatrick open and vows to “pursue every legal and regulatory avenue” to keep the plant open. However, this vow rings hollow, as Governor Cuomo is pushing to prematurely close Entergy’s Indian Point Nuclear Power Plant in southern New York, one that is actually profitable. Undoubtedly, these political shenanigans were a factor in deciding to close Fitzpatrick.

Former Senator Evan Bayh (D-IN) put it this way, “Fitzpatrick’s closing will be felt acutely by residents of Scriba and by the entire state of New York, given that the plant employs more than 600 highly-skilled employees and the state’s nuclear plants in aggregate generate 33 percent of New York’s electricity.  What’s more, nuclear plants produce well over half – 61 percent – of New York’s emission-free electricity [most of the rest is from hydropower].  Clearly, closing one of New York’s nuclear plants will only make it harder for the state to reduce carbon emissions, especially at a time when states are working to comply with emissions targets set forth by the Environmental Protection Agency’s recently finalized Clean Power Plan to ensure a cleaner energy future for the country.”

As the United States prepares to attend the next United Nations Conference on Climate Change (COP21) in Paris next month, we appear soft in our support of serious climate change policy. The U.N has repeatedly stated that nuclear needs to be a significant player in order to address climate change. If the world’s largest capitalist economy can’t figure out how to fix a warped energy market to value its largest source of emission-free electricity, then we aren’t very good capitalists.

And if our nuclear plants keep closing without concern for the negative effects on local economies, then we don’t really care about our middle class either.

Follow me on Twitter @jimconca and see my book with Dr. Judith Wright at Amazon.com