The early closure of the Indian Point Energy Center seems dumb with each passing month.
Last month’s heat wave increased the demand for electricity and air conditioning, causing strain on the region’s power grid. On July 21, more than 4,000 New York City residents were left without power for several hours and Con Ed asked Queens residents to reduce their energy use. The tool even lowered the voltage on some of its lines while it was restoring service.
The heat wave highlighted the fragility of New York’s power grid and the folly of early shutdowns of nuclear reactors at the 2,069-megawatt Indian Point Energy Center, which closed in April 2021. In the wake of this shutdown, New York consumers are paying more for electricity, and greenhouse gas emissions from the sector Energy is rising and the grid is becoming less reliable.
Before we proceed, let’s put Indian Point in context. It was among the most important parts of southern New York’s energy infrastructure. By itself, it pumped out roughly 25% of all electricity used in New York City, and it did so from a one-square-kilometre plot of land on the Hudson River located about 40 miles north of Times Square. Prior to its closure, the two reactors on the site were producing about 16 TWh of electricity per year. This was about twice the amount of electricity produced by all wind and solar projects in the entire state.
The closure of Indian Point has caused electricity prices to rise. In 2021, the average wholesale price of electricity in New York was $47.59 per megawatt-hour. That’s nearly double the cost in 2020. Why are prices rising? According to an independent market observer working for the New York Independent System Operator (NYISO), the agency that operates the state’s power grid, electricity prices have “generally gone up as a result of the retirement of Indian Point.”
None of these things should come as a surprise. It was clear that once Indian Point closed, its production would be replaced by gas powered generators. This increasing reliance on natural gas for electricity production has made New Yorkers more vulnerable to the vagaries of the gas market. Fifteen months ago, before the nuclear plant shutdown, the spot price of gas was less than $3 per million British thermal units. Today, the same amount of power costs about $8.50. Higher gas prices mean higher electricity prices.
Last month, Con Ed warned its New York City customers that their utility bills will be 12% higher this summer than last year due to higher natural gas prices. Westchester County residents will see their bills rise 16%. More pain on the way. Con Ed asked the Public Service Commission to approve a 17.6% increase in electricity prices.
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Generating more electricity from gas has led to significant increases in greenhouse gas emissions. In February, Politico reported that New York’s energy sector emissions totaled 28.5 million tons in 2021, an increase of 4.5 million tons compared to 2019, and that the increase in emissions “coincided with the shutdown of the two nuclear units at Indian Point.”
Stupidly, Indian Point has been closed at the same time that the state requires increased use of weather-dependent renewables, and gas-powered generators are being forced offline. The result of all of these things is lower reliability.
Last month, the NYISO released a report that said as the state adds more renewables, “balancing intermittent supply will become increasingly difficult.” She continued, “The New York network faces unprecedented reliability challenges,” and that “reliability risks will increase due to uncertainties in demand, supply, and available infrastructure.” Gas-fired power plants with a total capacity of about 1,600 megawatts located in the Lower Hudson Valley, Long Island and New York face restrictions due to new air quality rules imposed by the state. Approximately 1,000 megawatts of this capacity will be forced offline as soon as May 2023. The rest will not be available by 2025.
Who is to blame for this mess? The major environmental groups that pushed for the closure of Indian Point – which, in fact, sniffed when it happened. Those groups had a powerful partner in former governor Andrew Cuomo, who boasted in 2017 that he had been “personally trying to shut them down for 15 years”.
While nonprofit groups and Cuomo have managed to score political points by decoupling more than 2,000 megawatts of cheap, reliable, and carbon-free power, the unfortunate rhetoric here is clear: New York’s electricity prices are rising, grid reliability is decreasing and greenhouse gas emissions are rising. Height. This is a bad trio.
The closure of Indian Point will haunt New York for many years to come.
Bryce is a host.Hungry Power Podcastexecutive producer of the documentary,Juice: How electricity explains the worldand author of six books, including most recently,The Question of Energy: Electricity and the Wealth of Nations. “