(Adds Entergy comment, some projects that could replace Indian
Point power, new share price)
Jan 9 Entergy Corp's over 40-year old
Indian Point nuclear power plant will be shut by 2021 because of
concerns for the safety of millions of New Yorkers in and
around the Big Apple, Governor Andrew Cuomo announced on Monday.
After fighting for nearly a decade to renew the plant's
licenses, Entergy has agreed to shut the reactors, which supply
about a quarter of New York City's power needs, giving the state
time to find alternative power sources.
"I am proud to have secured this agreement with Entergy to
close the facility 14 years ahead of schedule to protect the
safety of all New Yorkers," Cuomo said in a statement.
The governor said Indian Point had been plagued by numerous
safety and operational problems, including faulty bolts, and
various leaks and fires.
The densely populated surrounding region lacks viable
evacuation routes in the event of a disaster, said Cuomo, and
the plant was once cited as the most vulnerable to earthquakes
in the country.
Of the plant's two operating reactors, first licensed to
operate in 1973 and 1975, Unit 2 will close as early as April
2020 and Unit 3 in April 2021.
New York has been developing contingency plans for years to
replace the power supplied by Indian Point, which is located in
Buchanan, along the Hudson River about 45 miles (72 kilometers)
north of midtown Manhattan.
The plant produces about 2,069 megawatts of electricity,
enough to meet 25 percent of the power used by New York City and
adjacent Westchester County.
Cuomo said replacement power would be in place that adds "no
new carbon emissions" and would have "negligible cost impact to
A couple of carbon-free projects that could replace some of
the power generated at Indian Point are the Champlain Hudson
Power Express project being developed by Transmission Developers
Inc, an affiliate of Blackstone Group LP, and an offshore
wind farm being developed by a unit of Norwegian oil company
Statoil ASA in the Atlantic Ocean, off Jones Beach.
The $2.2 billion Champlain Hudson project can transmit up to
1,000 MW of wind and hydropower produced both in upstate New
York and Canada and deliver it to the New York metro area, while
Statoil is looking to build a 400-600 MW wind farm off Long
A few natural gas-fired projects that are not carbon free
but could still help replace some of Indian Point's power
include Advanced Power's 1,000-MW Cricket Valley project in
Dover, Competitive Power Ventures' (CPV) 650-MW Valley plant in
Wawayanda and NRG Energy Inc's proposed 1,040-MW Astoria
repowering project in Queens.
CPV has said in past releases that its Valley project, which
is under construction and has been reported to cost $900
million, will be completed in 2018.
Advanced Power expects to complete its $1.5 billion Cricket
Valley project by the fourth quarter of 2019, according to a
statement by BlackRock, an investor in the project.
ENTERGY FOCUSING ON REGULATED UNIT
The shutdown comes as New Orleans-based Entergy has been
pulling back from its merchant nuclear business over the past
few years to concentrate on its regulated utilities in the U.S.
South. Indian Point was the only unregulated nuclear plant it
had tried to keep.
"The shutdown will complete Entergy's exit from its merchant
power business because of sustained low wholesale energy
prices," Entergy said in a statement.
"Record low gas prices, due primarily to supply from the
Marcellus Shale formation, have driven down power prices," said
Bill Mohl, president of Entergy Wholesale Commodities.
Entergy has been trying to renew the federal licenses for
the two Indian Point reactors since 2007. Those licenses expired
in 2013 and 2015, but the units can continue to operate so long
as the renewal process is ongoing.
Shares of Entergy, which has been focusing on its utilities
in the South, were down 2.4 percent at $71.45 on Monday
(Reporting by Scott DiSavino and David Gaffen; Editing by
Marguerita Choyediting and Lisa Von Ahn)