Don't rush into life without Millstone
Sooner or later, the region will be dealing with the consequences of life without the Millstone Nuclear Power Station. Competition from abundant and cheaper natural gas supplies is undercutting profits for nuclear plants. Emerging zero-carbon energy generation sources like wind, solar and hydro eventually will make nuclear and fossil-fuel power plants obsolete.
The timing of a future without Millstone — and how smooth the transition to get there — are hot topics. The issue of the moment involves an upcoming bid proposal for a zero-carbon electricity supply auction conducted by the state Department of Energy and Environment (DEEP).
Dominion Energy, owner of Millstone in Waterford, has argued successfully that it should be included in the zero-carbon-emission regulated energy market. Millstone has been competing solely in the deregulated market with the fossil-fuel power suppliers, where natural gas providers have been claiming ever-greater market share. The natural gas surge has forced early closure of five nuclear plants across the country, and more are expected.
State Sen. Paul Formica, R-East Lyme, led a coalition of Millstone supporters in January when the General Assembly and Gov. Dannel Malloy instructed the regulators to review whether to include nuclear power in the zero-carbon electricity supply auction. In February, regulators approved allowing Millstone to compete with the zero-carbon suppliers.
Millstone’s competitive bid advantage would improve further if regulators consider the nuclear plant to be “at-risk” of ceasing operations. If Millstone is declared at risk, the regulators can consider non-price benefits of the nuclear plant, such as its ability to deliver a stable energy supply and avoid greenhouse gas emissions. Millstone currently supplies about 50 percent of Connecticut's total electric power and about 95 percent of the state's zero-carbon energy. If Millstone is deemed to be not at risk, it must compete on price alone with solar, wind and hydro.
Regulators will make a final determination of Millstone’s at-risk status in October. However, the bids from the energy suppliers are due by mid-September. Under that calendar, Millstone will be making a bid to supply energy without knowing under what criteria the bid is being judged.
Last week, DEEP tipped its hand when it submitted a preliminary draft of its request for proposal energy bids. DEEP stated that energy plants can only be considered at-risk during an “at-risk time period” that they said would not begin until June 2023: five years from now.
That language aroused an angry response from Dominion Energy CEO Paul Koonce. The CEO went nuclear with a letter insisting that “Millstone is at risk now."
“Dominion Energy must face critical business decisions regarding the future of Millstone, irrespective of the consequences those decisions might have on Connecticut and New England,” Koonce warned. Translation: If Dominion can’t earn a good return on investment with Millstone, they will close here and invest somewhere else with better profit potential.
This newspaper believes Koonce’s blunt statement is no idle threat. In 2012, Dominion shuttered its nuclear plant in Wisconsin. In the last decade, the company has shed all but three of its "merchant" power generating stations — privately-owned plants that sell their power in open markets. Millstone represents about one percent of Dominion's business; the company owns many plants in other states.
Millstone generates 2,100 megawatts of energy. By contast, the Deepwater Wind project to be constructed 65 miles offshore from New London will deliver 200 megawatts to Connecticut when it becomes operational in 2023.
Connecticut is years away from energy independence without relying on Millstone. Premature closure would cause more pollution from fossil-fuel sources needed to replace Millstone power generation, higher electrical bills for residents, and economic hardship for southeastern Connecticut because of job and property tax losses. These are the predictions of the consultants hired by DEEP to study Millstone.
That gives Dominion increased leverage today in its negotiation with Connecticut, leverage that will diminish over time as renewable energy sources increase capacity. The company is seeking to maximize profits from Millstone to justify extending the plant's operation.
Similar negotiations are unfolding in New York, Illinois and New Jersey where regulators are wrestling to keep nuclear plants functioning until renewable energy sources can replace them.
The day will come when Millstone ceases operation. That day can either come suddenly with chaotic consequences, or it can come gradually, in an orderly manner, with advance planning and fewer disruptions.
We urge DEEP to grant Millstone at-risk status now to qualify for the September proposal deadline.
The editorial board is composed of the publisher and four journalists of varied editing and reporting backgrounds. The board's discussions and information gained from its meetings with political, civic, and business leaders drive the institutional voice of The Day, as expressed in its editorials. The editorial department operates separately from the newsroom.
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