IMPACT OF CLOSING VERMONT YANKEE NUCLEAR PLANT

by Willem Post

INTRODUCTION

The New England grid managed by ISO-NE has a capacity of about 32,000 megawatts, power supplied about 130,000 GWh/yr, includes over 350 power plants and 8,000 miles of high-voltage transmission lines to provide power to about 6.5 million customers.

The power mix is 62% from CO2-producing fossil fuels, 26% from CO2-free nuclear, 6% from CO2-free hydro, 4% from CO2-producing wood waste, 2% from CO2-producing solid waste and 1% other (i.e., CO-free wind, solar, etc.). Almost all of this power is STEADY power and the grid is designed accordingly. The reason the few New England nuclear plants produce so much electricity is because their capacity factors, CFs, are about 0.92, much higher than the other plants on the grid.

Vermont Yankee, VY, Mark 1 type, boiling water reactor, BWR, rating 620 MW, replacement cost about $4 billion, produces 4,500-5,000 GWh/yr of LOW-COST, CO2-FREE, 24/7/365, STEADY power. VY annually pays millions of dollars in taxes and fees to the states of Vermont and Massachusetts. VY’s license expires in 2012.

Entergy, the owner of VY, has requested the US Nuclear Regulatory Commission, NRC, to extend the VY license to 2032. An unusual request? In the US, 17 of 36 plants with BWRs had their license extended from about 40 years to about 60 years. All of the extensions, except one, were for Mark 1 reactors.

The Vermont legislature has voted on a resolution to close VY in 2012. Entergy also needs a Certificate of Public Good from the Vermont Public Service Board, an entity created by the Legislature. If the Board withholds the Certificate, Entergy will likely go to court to protect a multibillion dollar asset of its shareholders. VY will be operating while the case is in court which may take some years.

Removing VY, fully paid for, from the CO2-free column into Safestore for 60 years is an unwise waste of CO2-free resources. The US should be ADDING power plants to the CO2-free column to reduce global warming.

Vermont acting on its own to shut down VY is unfair and counterproductive to the CO2 reduction efforts of the other New England states.

STUDY SUMMARY

Economic and Environmental Impact

If VY stops operating it will:

– increase Vermont power cost by $620,500,000 during the 6-yr period after VY is closed.

– raise Vermont electric rates from $0.120/kWh to $0.137 kWh, or 14.2%.

– require a capital expenditure to implement renewable power systems in 6 years = 2,086/3,595 ($2.49 billion + $5.14 billion) = $4.43 billion. See Vermont Electric Power in Transition report, pg 3.

http://www.coalitionforenergysolutions.org/vt_elec_pwr_in_transitionpr.pdf

– add 66 billion lbs of CO2 to atmosphere, because of power purchases from the grid for 6 years.

VY’s direct employment is about 650 and its direct payroll, with benefits, is about $80 million per year. The economic multiplier effect is about three, meaning many businesses in a 25-mile radius from VY, a 300-sq mi area, will be under significant ADDITIONAL economic pressure and will have to cut staffs; estimates are more than 1,000 employees.

For comparison: the Duane Arnold Energy Center, Palo, Iowa, employs 600 people, annual payroll $85 million, recently received a 20-year license extension from the NRC.

The closing of VY would mean this 300 square-mile area will become an economic backwater, just as Windsor, Vermont, became a backwater when companies moved out; Windsor has not recovered after 30 years.

Impact on New England States

Instead of being a significant benefit to the economies and budgets of the States of Massachusetts and Vermont, the area will become a significant burden for many years. Tax collections will be less by many millions of dollars and payments for unemployment benefits, etc., will increase, all this while these states have large budget deficits for years to come.

New England states will have deficits for years to come. People, including voters, are suffering; the Great Recession is here and now. There is no money for heavily subsidized, multibillion dollar renewables buildouts that produce just a little of expensive power per invested dollar, removes just a little CO2 per invested dollar and creates few jobs per invested dollar.

The last thing New England households and businesses need is to see unnecessary electric rate increases that will be reflected as higher prices later. Closing VY means Vermont would be shooting itself and other New England states in the feet at the worst of times.

Vermont’s standing among New England states would be diminished at exactly the time it needs to cooperate with these states to integrate PV solar and wind power into the grid.

Vermont acting on its own to encourage renewables will not lead to a desired overall result for New England.

Subsidies to Attract Capital

Vermont, a very marginal state for PV solar and wind power, will have to offer a PV solar FIT of at least $0.30/kWh and a wind FIT of at least $0.08/kWh and 20-year power purchase agreements, PPAs, to attract the billions of dollars required to build the PV solar and wind systems.

For comparison:

-current ISO-NE grid prices are about $0.06/kWh.

-Hydro-Quebec and VY power on long term contract is about $0.06/kWh AND requires no capital investments.

Grid Modifications

The ISO-NE grid is not designed for large variable and intermittent power inputs. Large quantities of variable and intermittent power cannot be fed into the grid without major modifications.

Rushing into expensive, variable, intermittent wind and solar power without, what engineers call, systems planning (in this case grid-wide planning, including Hydro-Quebec) is unwise.

Power Purchases

The closing of VY would immediately require increased power purchases from Hydro-Quebec (if transmission capacity is available) and from the grid, and ultimately would require Vermont to spend billions of dollars for the construction of PV solar and wind systems to generate 2,086 GWh/yr to replace the power provided by VY.

Other New England states also will have to increase their purchases from the grid and, if so inclined, raise billions of dollars for PV solar and wind systems to generate about 2,500-3,000 GWh/yr to replace the power provided by VY.

Power purchases from the grid by New England states due to the closing of VY will last for many years, because it will take many years to construct the renewables capacity to replace VY. This means the CO2-producing power plants on the grid have to increase their outputs to provide that power to New England states; the nuclear plants on the grid already are operating near maximum capacity. A step backwards for global warming.

PV SOLAR, BIG WIND AND SMALL WIND IN VERMONT

PV Solar

PV solar power for true-south-facing, correctly-angled, fixed-tilt systems in Vermont has a theoretical maximum capacity factor, CF, of about 0.143, the statewide actual CF is a dismal 0.12 , because roofs are not true-south-facing, etc.

PV power output varies with the sunlight, of not much use on cloudy days, during the winter especially when panels are snow-covered about 20 days, or more, of a winter season, and is not “there” at night, requiring CO2 power purchases from the grid throughout the year.

Solar power in New England, without subsidies equivalent to about 50 to 60 percent of the capital cost, is expensive relative to utility power, especially for residences.

http://www.coalitionforenergysolutions.org/residential_pv.pdf

Big Wind

Big wind power on some high ridge lines in Vermont has a CF of about 0.33; the power output varies with the wind strength, steadiness and duration. The power is not “there” when there is too little, no wind, or too much wind, requiring CO2 power purchases from the grid throughout the year.

Wind turbines must be:

– located on high ridge lines, 2,000 ft, or higher, with good winds

– accessible by roads which must be maintained throughout the year

– near existing power lines with adequate capacity

– sited on soils that provide adequate foundation support

– be about a mile from private residences to reduce noise impact at night

There are not many miles of ridge line in Vermont that satisfy all these necessary conditions i.e., whereas, there is a large POTENTIAL for wind power, only a small fraction of it is economically feasible.

Small Wind

Small wind, 10 kW or less, usually located away from high ridge lines, has a CF of about 0.10; its power is even more expensive than PV solar power. Vermont’s subsidies for small wind are poor policy, an egregious waste of scarce taxpayer money.

http://www.coalitionforenergysolutions.org/residential_wind.pdf

ANALYSIS OF ALTERNATIVES

Per the VPIRG “Repowering Vermont” report, Strong Case, renewable power is to be 15.4% PV solar and 27.4% wind, for a total of 42.8% = 3,595 GWh/yr by 2032. The installed capital costs of the VPIRG Strong Case is about $2.49 billion for small and big wind and about $5.14 billion for small and big PV solar (2010$).

Vermont uses about 40% of VY’s output = 2,086 GWh/yr = 34% of Vermont’s 2008 electricity consumption. The impact of providing the 2,086/3,595 fraction of the VPIRG Strong Case will be studied.

Before rushing into closing VY, some questions need to be answered:

– what is the installed capital cost of the renewable power systems?

– what is the electric rate increase?

– how much additional CO2 is produced due to closing VY?

– what is the impact on the economy in the vicinity of VY and on the State of Vermont.

Two alternatives will be studied to answer these questions.

The assumptions are:

– it will take at least 6 years to produce the renewable power

– a new PPA with VY is at $0.06/kWh (the current PPA at about $0.042/kWh expires in 2012)

– grid power is sold to utilities at $0.06/kWh

– Vermont’s 2008 consumption of 6,134 GWh/yr will stay about the same until 2018 to simplify the analysis

– it will take about 6 years to build the PV solar and wind systems and integrate them into the grid which, based on progress to-date, appears to be very optimistic.

BASE CASE: VY CONTINUES OPERATING

Consumer cost of power would consist of: 34% VY power + 66% grid power for 6 years = $4,416,500,000.

See note 1.

Consumer statewide average unit cost of power for 6 years = $4,416,500,000/(6,134 GWh/yr x 6 yrs) = $0.120/kWh

Capital cost is ZERO dollars.

CO2 impact is unchanged.

ALTERNATIVE CASE: VY STOPS OPERATING

Vermont would have to:

– build, own, operate, maintain renewable power sources which are assumed to come on line from 2012 to 2018;

– offer an FIT of $0.30/kWh for solar and $0.08/kWh for wind, and 20-year PPAs to attract capital, i.e., billions of dollars.

Consumer cost of power would consist of: grid power to replace VY + renewable solar and wind power to replace VY + 66% grid power for 6 years = $5,0370,000,000. See note 2.

Consumer statewide average unit cost of power for 6 years = $5,0370,000,000 /(6,124 GWh/yr x 6 yrs) = $0.137/kWh

Capital cost to implement renewable power systems in 6 years = 2,086/3,595 ($2.49 billion + $5.14 billion) = $4.43 billion

CO2 charged to Vermont (40%) = 620,000 kW x 8,760 hrs/yr x 0.9 x 6 yrs/2 x avg 1.8 lb CO2/kWh = 26,395,632,000 lbs

CO2 charged to other states (60%) = 1.5 x 26,395,632,000 lbs = 39,593,448,000 lbs

CALCULATIONS AND NOTES

Vermont utilities buy their power at an average of about $0.06/kWh and sell it at an average of about $0.12/kWh. The “$0.06/kWh added by utility” is for distribution, various utility costs and return on investment.

Note 1. $0.12/kWh ($0.06 +$0.06, added by utility) x 2,086 GWh/yr x 6 yrs + $0.12/kWh ($0.06+ $0.06 added by utility) x (6,134 GWh/yr – 2,086 GWh/yr) x 6 yrs = $4,416,500,000

Note 2. $0.12/kWh ($0.06 + $0.06, added by utility) x 2,086 GWh/yr x 6 yrs/2 + [$0.36/kWh ($0.30 + $0.06, added by utility) x 0.154/0.428 x 2,086 GWh/yr + $0.14 ($0.08 + $0.06, added by utility x 0.274/0.428 x 2,086 GWh/yr] x 6 yrs/2 + $0.12/kWh ($0.06+ $0.06 added by utility) x (6,134 GWh/yr – 2,086 GWh/yr) x 6 yrs = $5,0370,000,000

Power cost increase: $5,037,000,000 – $4,416,500,000 = $620,500,000, equivalent to raising the unit cost from $0.120/kWh to $0.137 kWh, or 14.2%; this is in addition to future increases due to rising energy prices and any additional acts of the Vermont Legislature that will raise energy prices.

Willem PostBSME New Jersey Institute of Technology, MSME Rensselaer Polytechnic Institute, MBA, University of Connecticut. P.E. Connecticut. Consulting Engineer and Project Manager. Performed feasibility studies, wrote master plans, and evaluated designs for air pollution control systems, power plants, and integrated energy systems for campus-style building complexes. Currently specializing in energy efficiency in buildings. He is a founding member of the Coalition for Energy Solutions.

One thought on “IMPACT OF CLOSING VERMONT YANKEE NUCLEAR PLANT

  1. I will be patient to see this play out. Implicit with their request is that the information released to date is insufficient to make a deaniminttroe. I agree with them. Will they be able to access the original records, perhaps not. But they are saying what is being relied on by others, is unreliable to make a determination. This is significant. Lets see what happens next as other AZ officials are briefed. Bill G

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