Consumer rights group Public Citizen is asking the Federal Energy Regulatory Commission (FERC) to reject Entergy’s application to sell its James A. FitzPatrick Nuclear Power Plant to fellow power provider Exelon, arguing that the utilities failed to address the impact the $110 million deal would have on New York state’s power market.
If the deal goes through, Exelon would own all three upstate nuclear power plants, standing to reap about $8 billion in energy subsidies under Gov. Andrew Cuomo’s Clean Energy Standard, according to Public Citizen, which objected to the program’s passage in August.
Cuomo has touted the energy program as a rescue net for struggling atomic energy facilities, as the credits are expected to pay upstate nuclear power plant operators up to $1 billion over its first two years. FitzPatrick and Exelon’s R.E. Ginna Nuclear Power Plant and Nine Mile Point Nuclear Station were all scheduled or expected to close prior to Cuomo’s rollout.
“The application before FERC fails to include any mention of New York Gov. Andrew Cuomo’s proposed Zero Emission Credit (ZEC) subsidy and its potential impact on Exelon’s market power,” Public Citizen stated in a press release Monday. “Exelon is trying to purchase FitzPatrick only for the financial value of the ZEC.”
The consumer rights group demanded that Exelon and Entergy redo their market power analysis and resubmit the results to FERC for further assessment, while also questioning whether Cuomo’s zero-emission credits violate FERC rules. Public Citizen suggested the market analysis report consider the impacts of ZEC pricing “either on Exelon’s ability to exercise market power or the broader impact the ZEC will have on the functioning of the New York Independent System Operator energy and capacity markets.”
“While New York has claimed that the ZEC has been structured to address climate change, details in the ZEC program reveal it to be a convoluted and improper effort at economic development by forcing all New York ratepayers to provide unprecedented subsidies to the nuclear power plants,” Public Citizen said. “Such economic development programs are inconsistent with FERC’s rules and regulations.”
Entergy spokeswoman Tammy Holden said by email Thursday the company is confident that its applications to the New York Public Service Commission, the Nuclear Regulatory Commission, and FERC “are complete and demonstrate that the transaction should be approved.” Last week, the NRC announced that it had accepted Entergy and Exelon’s joint transfer application, allowing it to move forward with a full review of the sale.
Public Citizen believes the structure of Cuomo’s zero-emission credit program conflicts with a tariff approved by FERC and the New York Independent System Operator (NYISO), which monitors reliability of the state’s power system.
The group suggested FERC examine whether the credit program conforms to the agency’s rules and regulations in this regard. Public Citizen also argued that the costly subsidies divert investment from “superior” energy sources, such as wind and solar power.
“Giving billions of dollars to a single company operating three aging nuclear power plants that are no longer economically feasible is the wrong direction for New York,” Public Citizen Energy Program Director Tyson Slocum said in the statement. “Instead, the state should invest in cost-effective, forward-looking and safe strategies like boosting renewables and energy efficiency.”
Exelon representatives could not be reached for comment.
