Warning of an emerging energy crisis that will undermine economic growth and the quality of life in Westchester County and the region, a newly formed alliance of business groups last week issued a call to action by government officials to begin planning now to avert what could be a grim scenario within a decade.
In a worst-case scenario, electric bills for residential customers and small businesses would rise by about 150 percent by 2017. Those higher energy costs would slow the pace of Westchester”™s business growth, resulting in as many as 11,000 fewer jobs created in the next decade, $2.1 billion in cumulative lost wages and nearly $5.5 billion in cumulative lost economic output, according to a consultant for the alliance.
“State and local officials need to start working now to identify locations for new power plants and to attract companies to build and operate those plants,” said Marsha Gordon, president and CEO of The Business Council of Westchester, one of four groups in the alliance. Other members are the Builders Institute of Westchester and the Mid-Hudson Region Inc., the Construction Industry Council and Building Contractors Association, and the Westchester County Board of Realtors Inc.
Concerned about rising energy costs for businesses they represent, coupled with inadequate power supplies and fast-growing demand in the metropolitan region, alliance members commissioned Albany management consultant Howard J. Axelrod, owner and president of Energy Strategies Inc., to assess energy needs in Westchester and the economic impact of rising prices and short supplies. The alliance and Axelrod”™s report were especially driven by the prospect of Entergy Inc.”™s two nuclear plants at Indian Point closing when their operating licenses expire in 2013 and 2015 without ready replacement sources. Together those plants generate 2,000 megawatts, representing 40 percent of peak electrical demand in the lower Hudson Valley and more than 75 percent of electric energy consumed in the region.
In December, New York state and Gov. Eliot Spitzer, citing numerous safety and security concerns, formally joined the opposition to the plants”™ relicensing by the Nuclear Regulatory Commission. That opposition also includes Westchester County under County Executive Andrew Spano and most of the region”™s elected Democratic officials at the county, state and federal levels. The county”™s two largest business advocacy groups, the Business Council and the Westchester County Association, both support the plants”™ relicensing and Indian Point”™s continued operation as an environmentally clean supplier of relatively inexpensive electricity.
The alliance “supports the continuing safe and reliable operation of Indian Point,” said White Plains real estate broker Henry W. Fries, representing the Westchester County Board of Realtors. “We have to have ”˜safe and reliable”™ but keep it going.” He added, however, “This is not a pro-Indian Point report. This is a let”™s-face-the-facts” report.
One such fact, said Axelrod, is that without a streamlined review and approval process in the state for new power plants, they cannot be planned and built in time to replace Indian Point generation if those nuclear reactors close when their licenses expire. The most likely viable replacement source, a natural gas-fired plant, would take up to eight years to complete, he said. “It is literally impossible to start today and meet those time frames,” Axelrod said. “It would take well past 2013 and 2015 to bring that to fruition.”
Without a “one-stop” certification process for new power plants in the state, Axelrod also noted, “It becomes extremely risky for a competitive investor” to sink “billions of dollars” into power plant development.
“Here we are in 2008 and there has been no original planning about what to do” to replace Indian Point power and meet a projected 800-megawatt increase in electrical demand in the region by 2015, said Ross J. Pepe, president of the Construction Industry Council in Tarrytown. “The train has left the station. We”™re watching it leave the platform and go into the future without us.”
“The train is well past and everyone has left the station and you”™re already in the dark,” said Axelrod.
If Entergy”™s license renewal is denied by federal officials, the company could retire the Indian Point plants ahead of schedule as economically obsolete, Axelrod warned.
Albert A. Annunziata, executive director of the Building and Realty Institute in Armonk, called the commissioned report “a sober assessment that basically says to everyone within this county and beyond that it”™s not a simple choice. So far the hard choices, and arguably the right choices, have not been made. The overall picture is ”“ I don”™t want to say bleak ”“ but it”™s challenging.”
Noting the proliferation of nuclear plants in populous areas in European countries, Annunziati said, “The question has to be asked, ”˜How does Europe do it?”™”
“I honestly think the government thinks this is just going to resolve itself,” he added.
Alliance leaders called on the county”™s government and business leaders to develop and implement a strategy that will:
Ӣ Accelerate the pace at which energy conservation and energy management are deployed.
Ӣ Foster the introduction of renewable energy resources, especially within Westchester, to reduce reliance on out-of-region generation and transmission.
Ӣ Support enactment of streamlined generation and siting regulations to balance the need for economical supplies of electricity with mitigating environmental impacts.
Ӣ Support the continued safe and reliable operation of Indian Point.
“This is a beginning call to action,” Gordon said.
Having sounded a public alarm, alliance leaders said they will meet next with government officials. “We don”™t see a lot of friendliness on that side of the aisle, to tell you the truth,” said a spokesman for the group.
