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Possible Indian Point Nuke Shutdown Heightens Economic Fears

For more than half a century Indian Point has been a prime employer and tax-revenue generator in the Westchester County region of New York

By Alice Kenny, SolveClimate News

Jul 11, 2011
Mayor Michael Bloomberg

Editor's Note: In this three-part series, SolveClimate News examines the feasibility of closing the Indian Point nuclear facility in Buchanan, N.Y. The plant, now up for relicensing, faces demands for a shutdown by Gov. Andrew Cuomo and many environmental groups. This is part three. (Read parts one and two.)

Danny Carey, a third-generation steamfitter at the Indian Point nuclear power plant, sits on his porch in Cortlandt Manor, N.Y., reminiscing about his family's decades-long contribution to the facility in Buchanan, about 15 minutes north. 

Carey's grandfather, Tom, helped build Indian Point 1, which was shut down 37 years ago. His father, Tom Carey Jr., worked on the current active reactors, units 2 and 3. And for the past three decades, Danny, 51, has welded pipes and repaired valves at the controversial nuclear complex that serves up to a quarter of New York City's electrical needs.

"So many families lived and made careers out of that plant," he said, his muscled arms and sun-etched face bearing witness to a lifetime of labor. "It's provided a lot of work for a lot of years."

For more than half a century Indian Point has been a prime employer in the region, providing work to nearly 1,000 contractors and 1,100 salaried workers each year, said Jerry Nappi, a spokesperson for the plant. 

Nappi estimated that the plant's total annual payroll is $137 million, putting the average yearly income for employees at roughly $125,000.

Government officials have relied on the approximately $75 million in property taxes, fees and revenue-sharing that Indian Point — now owned by Entergy Nuclear — pays to state, county and local governments. 

Entergy foots a third of Buchanan's tax bill, making it one of the least-taxed villages among Westchester County's six cities, 19 towns and 23 villages, according to village records. The utility contributes nearly $18 million, or approximately one quarter, of all the taxes collected by the local Hendrick Hudson School District. Additionally, Indian Point's security force rivals that of many local police departments.

However, all of these perks may soon end. 

The 40-year operating licenses for the plant's two reactors, 2 and 3, are set to expire in 2013 and 2015. Gov. Andrew Cuomo along with other state politicians and residents who are galvanized by fears that a tragedy similar to Japan's Fukushima disaster could happen in their backyard are demanding the plants' licenses not be renewed.

As federal regulators weigh approval, key political and business figures on both sides of the battle are trying to shape the debate over the economic impacts of Indian Point's closure.

Bloomberg: 'Critical to the City's Economy'

The plant has the capacity to provide more than 2,000 megawatts of electricity, roughly a quarter of New York City's electricity needs and 12 percent of the entire state's, reports the New York Independent System Operator (NYISO), which oversees New York's power markets and distribution. 

Currently, New York City doesn't have enough alternatives to substitute for Indian Point's electricity, especially during high-demand periods such as in the summer months, NYISO says.

Because the city is located far from sources of relatively inexpensive and cleaner hydroelectric or wind resources, a 2006 assessment by the National Academy of Sciences said the city would need five new natural gas- or oil-fired plants to replace Indian Point. Other options include building high-voltage transmission lines to carry power from upstate New York, New Jersey or Canada to New York City.

High-profile opponents have challenged the feasibility of these solutions. 

"All of these other alternatives are a number of years down the road," said New York City Mayor Michael Bloomberg at a recent news conference. "We have to have power if we're going to grow, and Indian point, at the moment, is a big part of that." New York City is expected to add 1 million residents by 2030.

"Local air pollution would increase" with new fossil-fuel generation, Bloomberg added, making "our efforts to reduce greenhouse gas emissions ... unachievable." The city aims to cut heat-trapping gases by 30 percent by 2030. Overall, the mayor said: Indian Point is "critical to the city's economic viability."

The Business Council of Westchester, the largest business organization in the county where Indian Point is located, makes a similar point for its region.

In a 2008 analysis, the group concluded that closing Indian Point would "cripple lower Westchester's economy."

The report said that "sky-high electricity prices" would force businesses to close or relocate,  costing the region 9,000 jobs, on top of the plant's direct employees. A shutdown would cost $2.1 billion in cumulative lost wages and nearly $5.5 billion in lost economic output, it said.

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