What FitzPatrick nuclear closing says about our power grid
Energy giant Entergy’s decision to close its nuclear plant near Oswego shocked the central New York community. 615 people will lose their jobs. State officials are still working to get Entergy to change its mind. The news also sent shock waves through New York’s electricity markets.
Plants like FitzPatrick, right on the shore of Lake Ontario, are the workhorses of the grid. Nuclear plants are powerful. In New York, four plants produce almost a third of the state’s electricity. They’re reliable in the frigid polar vortex when natural gas and coal can go cold, and in the heat of summer when wind dies down.
But in deregulated electricity markets nuclear doesn’t get paid a bonus for that reliability. Chris Gadomski of Bloomberg New Energy Finance said, “To have a technology that’s dispatchable any time of the day is a premium type of electricity, and the nuclear power industry is not being compensated adequately for that.”
Hydropower is in a similar situation. Both face another pricing problem. Wind power can bid very low because it gets federal subsidies. Sometimes wind offers its electricity for negative prices to be the lowest bidder.
These pricing problems are factors in FitzPatrick going offline. But the biggest reason is cheap natural gas from the nearby Marcellus shale driving down prices. Fitzpatrick nuclear is projected to lose $60 million bidding against electricity plants powered by natural gas.
“Natural gas is making it very rough for the nuclear plants, not just in our towns and in our county, but throughout the United States,” said Ken Burdick, supervisor of the town of Scriba, home to FitzPatrick and near the two Nine Mile nuclear reactors. “We’re a nuclear community,” said Burdick. People around here pay close attention to energy markets. So when Entergy announced the closure, it wasn’t a surprise, but it hurt all the same. “It’s almost a nightmare,” Burdick said. “It’s like a punch in the guts when something like this happens.”