New York Offers $7.6 Billion Bailout To Some Nuclear Plants, Forces Others To Shut Down
New York has plans to keep some of its nuclear power plants afloat with subsidies, despite recently forcing one reactor north of Manhattan to shut down.
The heavily regulated state is giving the subsidy to the Exelon Corporation, which owns two nuclear plants and has agreed to purchase a third. The subsidy is part of the New York’s plan to generate half its power without producing new carbon dioxide (CO2) emissions over the next decade.
The environmental group Alliance for a Green Economy claims the subsidy will cost New York citizens $7.6 billion dollars, and will be paid by raising power bills for the next 12 years.
“New York State is certainly not alone in grappling with how to keep nuclear facilities afloat while cheap natural gas is pushing down electricity prices across the country, but they have emerged as a cautionary tale,” Catrina Rorke, the energy policy director at the free market R Street Institute, told The Daily Caller News Foundation.
“While New York is selling their fix as part of an aggressive clean energy program, the Public Service Commission approved what amounts to the single largest transfer of wealth from private citizens to corporations in the history of the state,” Rorke said.
New York regulators will shut down the Indian Point nuclear power plant by April, 2021, even though doing so will make it nearly impossible for the state to comply with the governor’s global warming pledges. Entergy, which owns the plant, agreed with Democratic New York Gov. Andrew Cuomo to shut down the plant by 2021 in exchange for the state dropping safety and environmental claims filed against the reactors.
Cuomo repeatedly pledged to reduce New York’s carbon dioxide (CO2) emissions with the goal of slowing global warming. The governor created a $5 billion dollar fund to reduce CO2 emissions by spending money on wind and solar power. Indian Point generates more than 2,000 megawatts of electricity, or about one-fourth of the power consumed in New York City and Westchester County, while producing no CO2 emissions.
“If this were about a lower carbon future, there are any number of policies that New York could have implemented preference [for] lower-emissions power,” Rorke continued. “This is a move purely about supporting the powerful interests behind New York’s nuclear plants, even if it forces customers to buy more expensive power.”
Allowing the Indian Point plant to shut down will increase carbon dioxide (CO2) emissions by 29 percent, according to a report by Environmental Progress. Shutting down the plant will create twice as much CO2 as would have been reduced under the EPA’s Clean Power Plan.
The replacement power for Indian Point is likely to come mostly from natural gas power plants, not wind or solar. Nuclear power provides about 63 percent of America’s CO2-free power. A single nuclear reactor prevents 3.1 million tons of CO2 emissions annually.
Cuomo previously called for Indian Point to be shut down, as he claims it is too close to the densely-populated southern portion of the state. New York’s other nuclear reactors are in the much less populated, northern upstate region.
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