New York PSC continues review of Indian Point ‘straw proposal’

The New York State Public Service Commission issued a July 2 notice laying out some of its next steps in the docket where it is looking at alternatives in case Entergy’s (NYSE: ETR) Indian Point nuclear plant has to be retired.

On June 5, the commission issued a notice soliciting comments and about a technical conference, which, in part, sought comments on the documents submitted by the Department of Public Service Staff on June 4. These documents included a Straw Proposal for Regulated Reliability Cost Allocation and Cost Recovery, and a Reimbursement Agreement proposed by the New York Power Authority for the recovery of costs incurred in connection with the Indian Point Reliability Contingency Plan.

The June 5 notice indicated that initial comments should be submitted by July 8, while any reply comments should be submitted by July 22. In response to requests from parties at the first technical conference on June 21, the July 2 notice is to advise interested parties that initial comments should now be submitted by July 22 and reply comments should be submitted by Aug. 5.

A second technical conference will be hosted by DPS Staff on July 15. The purpose of the conference is to further explain the Straw Proposal filed by DPS Staff on June 4 and to discuss additional materials that will be posted in this proceeding prior to the technical conference. The technical conference will be held at the commission’s offices in Albany.

The Straw Proposal describes a methodology on how the costs associated with implementing the transmission or generation solutions that are ultimately part of the Indian Point Reliability Contingency Plan could be allocated and recovered from retail ratepayers. The Straw Proposal attempts to allocate costs based on application of the “beneficiaries pay” principle.

Indian Point is the site of two pressurized-water reactors. The initial 40-year operating license for Indian Point Unit 2 is set to expire on Sept. 28, 2013, while the initial license for Unit 3 runs through Dec. 12, 2015. Entergy is seeking a 20-year license extension for each unit. It submitted an application to the NRC seeking the license renewals in April 2007, but no final decisions have been reached yet by the NRC.

Indian Point 2 has a design net capacity of 1,078 MW, while Indian Point 3 has a design net capacity of about 1,080 MW. The closure of one or both of those units would leave a big hole in New York’s power portfolio, particularly since the plant is near the New York City load center. That concern triggered the New York PSC review process, which included earlier this year a request for proposals for new generation and transmission projects needed in case the Indian Point units have to shut.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.