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NatGas Killing Off Nuclear In NY

In a city once plagued by the flight of manufacturing, the presence of two nuclear power plants for the past four decades has been an economic lifeline. Now, though, their operator wants to close one of them no later than early 2017.

Entergy Corp. said Nov. 2 that it will close the James A. FitzPatrick Nuclear Power Plant in Scriba, N.Y., a move to save the company between $225 million and $275 million over the next five years, not only by limiting its operating losses but also reducing the capital expense of buying more fuel for the plant and paying an estimated 1,000 outside employees for a month-long refueling a year from now.

Civic leaders in upstate Oswego County, where Scriba is situated, say they’re looking for a way to persuade Entergy, based in New Orleans, to change its mind, but Entergy executives told Wall Street analysts that the decision is “clearly appropriate” for the company’s future.

Maybe the company will now prosper, but Scriba’s residents fear for the effect on their town.

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“I think it’s going to have a very, very devastating effect on our area and our schools,” said Missy Taylor, who owns Scriba’s Stylin & Smilin Hair Salon. “You’re going to see more homes abandoned.”

Taylor said two of her customers, a married couple who work at the FitzPatrick plant, were considering building a new home, but now have put those plans on hold until they learn whether they will still have jobs after the facility is shut down. “They’re nervous,” she said. “They don’t know what to do.”

Officials throughout the state as well as in Oswego County have been urging Gov. Andrew Cuomo to come up with a plan to head off a closure. Already Cuomo has called instead for Entergy to shut down another of its nuclear plants, Indian Point, just north of New York City, in order to keep FitzPatrick open.

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Entergy, though, notes that the recent proliferation of plants powered by low-cost gas has left FitzPatrick losing $60 million a year. Besides, the company points out, it has only one reactor, compared with the two at Indian Point. And the nuclear plant next to FitzPatrick, the Nine Mile Point Nuclear Power station, operated by another utility, Exelon, based in Chicago, also has two reactors.

Gas produced prodigiously through hydraulic fracturing is the chief culprit, Matt Huber, a professor at the Maxwell School of Citizenship and Public Affairs at nearby Syracuse University, told the regional broadcaster CNY Central. He said the practice, also called fracking, has created a gas glut with prices so low that nuclear power can’t compete with it.

Besides, Huber said, nuclear power is expensive even without competition from gas. “It costs an enormous amount, so they are already hurting from an economic standpoint,” he said. “So this natural gas thing is just going to make it worse.”

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Entergy has more than 600 employees at the FitzPatrick plant who are paid an average of more than $120,000 a year – more than twice the average annual pay of employees in any other industry in the area, according to L. Michael Treadwell, the executive director of Operation Oswego County, an agency that promotes industrial development in the region.

Treadwell said it would be nearly impossible to find so many new jobs with equivalent pay in the area. He knows because he has experience dealing with mass layoffs.

Entergy says it plans to lay off half of FitzPatrick’s 600 employees as soon as the plant is closed, then lay off more gradually as the reactor’s spent fuel cools off and is disposed of. The company said it will try to find new jobs for the idled workers, but they probably would have to be transferred to other plants it operates, an option that would only disrupt the Scriba community even further.

By Andy Tully of Oilprice.com

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