As state officials seek a way to keep the struggling Fitzpatrick Nuclear Power Plant open, a new study finds that losing them could lead to higher electricity prices.
The Brattle Group, an economic consultant firm, published a study this week that finds upstate nuclear power plants in New York -- Fitzpatrick, Ginna and Nine Mile -- hold energy prices down.
That's because nuclear fuel is cheaper than the cost of fossil fuels. Also, because nuclear plants buy their fuel in bulk and operate around the clock, their prices go up and down according to what the market demands.
"They reduce electricity prices to New York, we estimate, about $1.7 billion per year and then, there’s a multiplier effect as lower electricity prices give a boost to the rest of the economy," said Dean Murphy, one of the report's authors.
That boost to the economy comes in the form of nearly 25,000 jobs and more than $3 billion to the state's gross domestic product (GDP). The analysis also finds that nuclear power has higher long-term costs, including more employees than its alternatives, which means more tax revenues for the state.
The study was commissioned by three union groups that represent employees at the upstate nuclear power plants. It's intended to convince state lawmakers of their value to all of New York. Entergy, which owns FitzPatrick, has said it will close the plant in about a year due to falling energy prices and the subsidies that support the Ginna Plant are set to expire in 2017. Murphy said losing them could have a domino effect.
"The loss of the nuclear plants will put a drag on the economy overall, not just the direct effect of the plant’s workers or even the goods and services that are provided to those workers, but much more broadly because all customers pay for electricity and if they pay more for electricity they have less left over to spend on other items," Murphy said.
"The reality is, two of them are in jeopardy today. Two more could be there tomorrow. Again, I have to ask the question: where is the power coming from," asked Ted Skerpon, president of the IBEW Local Union 97, which represents 300 FitzPatrick employees and helped pay for the study.
Skerpon said New York state needs to find a way to help make its nuclear power plants more profitable.