nuclear-news

Earlier this month, the Omaha Public Power District proposed closing its 478-MW Fort Calhoun nuclear plant, the smallest in the U.S., and the Tennessee Valley Authority gave up on its unfinished Bellefonte nuclear station in Alabama and put it up for sale. Last month, Moody’s Investor Services reported that low natural gas prices threatened widespread nuclear and coal plant closures.

Those closures may bring owners less financial relief than they anticipate. As expensive as nuclear power plants are to build, safely shutting them down will also cost hundreds of billions, potentially trillions of dollars, Climate News Network reported last month. http://smartershift.com/energymix/2016/05/24/economics-point-toward-closure-for-up-to-20-u-s-nukes/

FPL’s plans to expand its nuclear energy plant at Turkey Point are on hold for four years

However, the utility’s plan to still charge customers for “recovery costs” has caused a stir

FPL should also pause charging its Florida customers — it’s only fair

Given a string of setbacks regarding FPL’s plans to expand the nuclear energy plant at Turkey Point, the recent disclosure that it plans to delay construction for up to four years is a victory for common sense and for critics who worry about the project’s impact on safety and the environment.

What doesn’t make sense is the utility’s desire to charge consumers for costs related to the project, particularly when the delay raises the prospect that it may not go forward at all.

FPL says the recovery costs will decrease during the delay, but remain necessary as part of the licensing procedure and the need to learn from other nuclear energy projects around the country that have also experienced unforeseen delays.

The company wants to charge customers $22 million in 2017 — on top of $281 million it has already recovered for planning and licensing costs — even though the utility said in anApril 27 filing with the state’s Public Service Commission that it wants to maintain its “current state” without going forward on the construction phase until 2020.

On top of that, the utility also wants the PSC to waive the requirement that it file a feasibility report that essentially states that the project it applied for nearly a decade ago is still viable.

That drew a volley of challenges from consumers groups, the Office of Public Counsel (which represents the public in rate cases) and others. A brief filed by the city of Miami said feasibility studies are required to assure the public that such projects are prudent. “If a project is no longer feasible or practical, then the costs incurred are not prudent,” wrote city of Miami attorney Victoria Mendez.

FPL’s decision followed several developments that cast doubt on the wisdom of the proposed expansion. Among them:

▪ Reports dating back to 2014 that water in the canals designed to cool reactors were running too high, requiring waivers from nuclear regulators to operate the canals at higher-than-normal temperatures. If the existing nuclear plant is causing problems, wouldn’t an expansion make matters worse?

▪ In February, A Tallahassee judge ordered state environmental regulators and FPL to clean up the utility’s cooling canals at Turkey Point after blaming the system for polluting South Florida’s groundwater.

▪ In March, this newspaper reported that a study released by Miami-Dade County Mayor Carlos Gimenez found that a tracer element of nuclear power plant spillages had been detected in Biscayne Bay at levels up to 215 times higher than normal in ocean water……..http://www.miamiherald.com/opinion/editorials/article80438112.html

Beginning in mid-2019, the Chicago region will pay about $9 per megawatt-hour in extra “capacity” charges to ensure power plants deliver when they’re most needed. The charges are set per a power-generator auction conducted by PJM Interconnection, which oversees the power grid from Chicago east to the Mid-Atlantic states.

Results of the auction were unveiled May 24. PJM conducts the bidding three years in advance. The prices will take effect in June 2019 and be embedded in the energy costs all commercial and residential customers pay.

The results are good news for Exelon, which has campaigned for higher revenues both through the PJM auction and also from the state of Illinois for its five Illinois nuclear plants in the PJM.

But the company’s bidding behavior will limit the revenue windfall it might have received. Its Quad Cities plant bid too high to get any revenue at all, and only a portion of the capacity at its Byron plant qualified.

If all of Byron had cleared the auction, Exelon would have received $653 million in revenue beginning in mid-2019. As it is, the company will see about $513 million, according to calculations based on a Securities and Exchange Commission filing.

That’s still higher than the $495 million it will get in the year beginning this coming June 1. And that’s with all the plants—Quad Cities and all of Byron included—getting paid.

Exelon says it will close Quad Cities as soon as mid-2018 without passage of a state law hiking electricity rates statewide to make that money-losing facility profitable. Had it cleared, Quad Cities would have received more than $100 million.

As it is, that’s money Chicago-area ratepayers will have to replace if the bill Exelon is pushing in Springfield passes. Exelon’s legislation demands a surcharge on electric bills sufficient to pay Quad Cities and the downstate Clinton nuke (which isn’t in PJM and isn’t eligible for the auction) $42 per megawatt-hour. The $9 Quad Cities isn’t getting because it didn’t qualify would have to be made up through the surcharge under the bill.

Of course, had Quad Cities qualified under the auction, Exelon would have been committed to keep it open until mid-2020. As of now, Exelon can close it as early as mid-2018.

In a statement, Exelon CEO Chris Crane said the high PJM-set prices aren’t enough to save Quad Cities.

“The capacity market alone can’t preserve zero-carbon emitting nuclear plants that are facing the lowest wholesale energy prices in 15 years,” Crane said.

Critics decried the outcome of the auction.

“There is a surplus of nuclear and coal in Northern Illinois,” said Howard Learner, executive director of Chicago-based Environmental Law and Policy Center. “Electricity demand is dropping. . . . There’s no reason revenues in the ComEd region should be twice as high as the rest of the region.”

A PJM spokeswoman said the price for ComEd was so much higher than the rest of PJM, which includes all or part of 12 other states and Washington, D.C., because of “transmission constraints inhibiting the ability to import cheaper power.”

Transmission is tighter than it used to be to move power generated to the west into Illinois, she said. And coal-plant retirements also are playing a part.

The fact that Quad Cities didn’t qualify for the PJM payments, though, also means that the 1,871-megawatt plant isn’t needed to meet Chicago-area electricity demand even during the hottest summer days. So, while Exelon has made the argument that reliability would suffer with the plant’s closure, PJM believes there’s enough capacity without Quad Cities to keep the lights on and provide a substantial cushion above that.

PJM last year overhauled its capacity market to boost prices consumers pay to power generators that promise to deliver even during the most extreme weather events like the polar vortex two years ago that crippled some plants.

Power generators face steeper penalties if they don’t produce under the new system, and consumers pay them more for the ironclad promise.

Exelon is pushing hard in Springfield for wide-ranging energy legislation, including the rescue package for the two money-losing nukes. The company has said it will move to close the plants, putting at risk about 1,500 high-paying jobs in parts of the state that aren’t flourishing economically.

Exelon had issued a May 31 deadline for Springfield action, but observers believe if anything happens at all, it won’t be until summer or early fall.