What happens to the electric grid, your wallet, and carbon emissions when you retire a troubled nuclear power plant just north of New York City? That’s the central question explored by Synapse Energy Economics, a leading utility industry firm, in a report released today by NRDC and Riverkeeper that finds clean energy—including energy efficiency, renewable power sources like solar and wind, and related transmission solutions—can fully and economically replace the plant after it closes in 2021.
When Governor Andrew Cuomo last month announced a negotiated agreement between New York State, Entergy, and Riverkeeper to close Indian Point’s two units, it was welcome news to the 20 million New Yorkers living in the shadow of the power plant and concerned about its long history of operational, safety, and environmental problems, as well as the grave risk of a nuclear accident so close to the nation’s largest city. The governor committed to replacing the power from the plant’s two units with clean energy, with no net increase in carbon emissions, which was also welcome news.
However, some have questioned whether that’s possible, what the plan is, and how much it will cost. Today’s Synapse report provides timely, practical, and positive answers to those important questions.
Synapse’s modeling shows that, with the right policies on the books and smart execution of those policies, New York can achieve an orderly and cost-effective clean energy transition without a net increase in carbon pollution or a risk to electric service reliability after Indian Point is shuttered as of April 2021.
The keys to success, according to the report, are scaling up renewable energy under New York State’s already adopted “50% by 2030” Clean Energy Standard (CES) and adopting policies to increase energy efficiency investments in the state’s buildings.
This study updates a similar February 2013 Synapse analysis to reflect how much has changed for the better on the clean energy front in New York State and throughout the country since the last report. Such developments include the plummeting cost of wind and solar power and other market dynamics, and the many state clean energy initiatives and replacement strategies launched in recent years by Governor Cuomo (who has been pushing for the closure of the troubled Indian Point plant since his time as Attorney General).
The study modeled six different futures
Synapse utilized the National Renewable Energy Laboratory’s (NREL) widely known Regional Energy Deployment System (ReEDS) model to perform an analysis of six scenarios over the 2016-2030 time period (which corresponds with both the CES time horizon and the New York State Energy Plan’s other near-term climate goals). The model included key inputs such as projected electricity demand, future transmission systems upgrades, and expectations about power plants exiting or entering the market in the coming years. (For more on the modeling specifics as well as detailed assumptions and outputs, see the report.) The scenarios ranged from business as usual, to retiring Indian Point while ramping up energy efficiency savings to 3 percent of total utility electricity sales plus adding the 1,000-megawatt Champlain Hudson Power Express (CHPE) transmission line delivering hydropower from Quebec to NYC. Below are the detailed descriptions of each scenario future:
- Indian Point in-service, status quo energy efficiency (EE): This is the “business as usual” baseline and includes current energy efficiency savings (equal to about 1 percent of utility electricity sales) continuing through 2030.
- Indian Point in-service, CES-assumed EE: Same as above, but with the 1.5 percent annual savings assumed to materialize in the Clean Energy Standard.
- Indian Point retired, CES-assumed EE: Same as above, but with the Indian Point Energy Center (IPEC) retired in accordance with the recent agreement (one unit offline in April 2020, and the second unit in April 2021).
- Retired, same level of EE, plus the 1,000-megawatt Champlain Hudson Power Express transmission line delivering hydropower from Quebec to NYC.
- Same as #4 above but with (high) EE savings ramping up to 3 percent/year, consistent with levels being achieved by leading states in the region like Massachusetts and Rhode Island.
- Same as #5 above, but without CHPE in service.
What did the modeling reveal?
Will the lights stay on once Indian Point closes? The answer is an emphatic yes. Synapse’s modeling demonstrates that in all scenarios, New York can meet the New York Independent System Operator’s reliability criteria—which require an ample margin for safety and reliability—while achieving its clean energy goals. (For more on how grid reliability can be maintained in a future with high renewables penetration, see this recent NRDC post).
Will closing Indian Point be a big utility bill hit for customers?
No, the costs will be minimal, and the more New York invests in energy efficiency improvements, the lower the cost. As outlined in the table below, the Indian Point retirement is projected to add between 0.2-2.1 percent to overall electricity wholesale costs; it’s important to note that these wholesale costs currently account for a little less than 50 percent of a New Yorker’s overall utility bill (the balance coming from the “distribution” or retail portion of the grid). The “Net Present Value” (NPV) metric is accounting for the overall wholesale system impacts across the 2016-2030 time horizon.
If a carbon-free nuclear plant is retired, will we backslide on our climate objectives? No, New York can continue to meet its ambitious climate goals even after Indian Point closes as long as New York State:
a. Effectively implements the Clean Energy Standard’s “50% by 2030” renewables program, including the governor’s recent bold commitment to deploy 2,400 megawatts (MW) of offshore wind power by 2030, starting with the 90 MW South Fork project just approved by the Long Island Power Authority; and
The following graph illustrates the emissions outcomes across the six scenarios.
Meanwhile, Governor Cuomo also recently committed to strengthening the nine-state Regional Greenhouse Gas Initiative (RGGI) in order to cut power sector carbon pollution by at least 30 percent from 2021-2030. That’s significant because under the governor’s proposal there would be an even more stringent carbon cap for the nine Northeastern and Mid-Atlantic states than the continued 2.5 percent annual decline assumed in the modeling. RGGI plays an important role in ensuring climate progress and will continue to do so after Indian Point closes.
Making big, bold changes in our energy mix so that we transition to a cleaner, safer future is no small task. But as the Synapse report illustrates, with the foresight to plan ahead, the execution of smart policies (especially scaling up energy efficiency), and the political will to follow through, New York can replace Indian Point’s power in an orderly fashion that maintains reliability, controls consumer costs, and protects the environment.