ML12340A598
| ML12340A598 | |
| Person / Time | |
|---|---|
| Site: | Indian Point  |
| Issue date: | 06/29/2012 |
| From: | Schlissel D Schlissel Technical Consulting, State of NY, Office of the Attorney General |
| To: | Atomic Safety and Licensing Board Panel |
| SECY RAS | |
| Shared Package | |
| ML12181A466 | List: |
| References | |
| RAS 22868, 50-247-LR, 50-286-LR, ASLBP 07-858-03-LR-BD01 | |
| Download: ML12340A598 (28) | |
Text
United States Nuclear Regulatory Commission Official Hearing Exhibit Entergy Nuclear Operations, Inc.
In the Matter of:
(Indian Point Nuclear Generating Units 2 and 3)
ASLBP #: 07-858-03-LR-BD01 NYS000437 Docket #: 05000247 l 05000286 Submitted: June 29, 2012 Exhibit #: NYS000437-00-BD01 Identified: 10/15/2012 Admitted: 10/15/2012 Withdrawn:
Rejected: Stricken:
Other:
1 UNITED STATES 2 NUCLEAR REGULATORY COMMISSION 3 BEFORE THE ATOMIC SAFETY AND LICENSING BOARD 4 -----------------------------------x 5 In re: Docket Nos. 50-247-LR; 50-286-LR 6 License Renewal Application Submitted by ASLBP No. 07-858-03-LR-BD01 7 Entergy Nuclear Indian Point 2, LLC, DPR-26, DPR-64 8 Entergy Nuclear Indian Point 3, LLC, and 9 Entergy Nuclear Operations, Inc. June 29, 2012 10 -----------------------------------x 11 PRE-FILED WRITTEN REBUTTAL TESTIMONY OF 12 DAVID A. SCHLISSEL 13 REGARDING CONTENTION NYS-37 14 On behalf of the State of New York (NYS or the State),
15 the Office of the Attorney General hereby submits the following 16 testimony by David A. Schlissel regarding Contention NYS-37.
17 Q. What is the purpose of your testimony?
18 A. The purpose of this testimony is to respond to the 19 testimony of Entergy Witnesses Donald P. Cleary, David Harrison, 20 Jr., and Eugene T. Meehan Regarding Contention NYS-37 (Energy 21 Alternatives).
22 Q. What documents did you review in preparation for your 23 rebuttal testimony?
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 1
1 A. I read Entergy's Statement of Position concerning 2 Contention NYS-37; the testimony of Entergy witnesses Donald P.
3 Cleary, David Harrison, Jr., and Eugene T. Meehan concerning 4 NYS-37 and exhibits thereto ("Entergy Testimony") and the report 5 prepared for Entergy by NERA Economic Consultants. I have also 6 read NRC Staff's Statement of Position concerning Contention 7 NYS-37 and the testimony of NRC witness Andrew L. Stuyvenberg 8 and exhibits thereto("Staff Testimony").
9 Q. What are your conclusions?
10 A. My conclusions are as follows:
11 1. Entergys witnesses on Contention NYS-37 (Energy 12 Alternatives) inappropriately used the widely 13 respected National Energy Modeling System 14 ("NEMS") to model the No Action Alternative. NEMS 15 is traditionally used to model the effect of 16 proposed policy changes or alternatives. I have 17 never seen it used, as Entergys witnesses use it 18 here, to model the retirement of one or two 19 specific generating units.
20 2. There are other production simulation models that 21 are traditionally used in the industry to 22 evaluate the economic and environmental impacts 23 of power plant retirements and the addition of Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 2
1 new generating capacity, energy efficiency and 2 renewable resources. For example, Entergys 2003 3 assessment of the potential economic and 4 environmental impacts of an Indian Point Energy 5 Center (IPEC) retirement used the GE MAPS 6 model.
7 3. Entergy has not modeled a credible No Action 8 Alternative. It assumes that there would be no 9 market or state response to replace the lost 10 generation from IPEC until 2026 other than 11 through the continued operation of old, dirty and 12 inefficient coal and oil/gas steam units that 13 would otherwise be retired by 2015.
14 4. The results of Entergys NEMS modeling of the No 15 Action Alternative do not provide credible 16 evidence that there would only be a small role 17 for additional energy efficiency and conservation 18 under the No Action Alternative.
19 A. Neither the NEMS Baseline analysis nor 20 Entergys No Action Alternative modeled New 21 York States current 15 x 15 energy 22 efficiency plan.
23 B. NEMS does not model energy efficiency as an Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 3
1 additional resource. Instead, the only way 2 in NEMS to model additional energy 3 efficiency is to reduce the energy forecast 4 - something that Entergys witnesses did not 5 do either in the Baseline Analysis or the 6 No-Action Alternative. For this reason, it 7 is not possible for NEMS to directly compare 8 the cost of continuing to operate Indian 9 Point against the cost of achieving more 10 energy efficiency. In fact, the NEMS model 11 could not add additional energy efficiency 12 even if it is the lower cost resource.
13 5. The results of Entergys NEMS modeling also do 14 not provide credible evidence that additional 15 renewable resources would not play a significant 16 role as replacement energy in a No Action 17 Alternative. In particular, Entergy did not 18 consider the potential for a proposed 19 transmission line to bring additional low cost 20 renewable resources into downstate New York from 21 Canada or that the cost of renewable resources 22 might decrease as a result of economies of scale.
23 6. Entergy unreasonably assumes in its No Action Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 4
1 Alternative that the following substantial 2 amounts of older, dirtier and less efficient coal 3 and oil and gas steam capacity would continue to 4 operate long past 2015:
5 x 323 MW of coal capacity in Upstate New York 6 that would otherwise be retired in 2015 or 7 2017 8
9 x 822 MW of oil and gas steam capacity in 10 Upstate New York that would otherwise be 11 retired in 2018 12 13 x 25 MW of combustion turbine capacity on Long 14 Island that would otherwise be retired in 15 2015 16 17 x 85 MW of coal capacity in New England that 18 would otherwise be retired in 2016 19 20 x 960 MW of oil and natural gas steam capacity 21 in New England that would otherwise be 22 retired in 2015 or 2016 23 24 7. Entergys witnesses misleadingly understate the 25 marginal cost of generating electricity at 26 existing coal and oil and natural gas steam 27 generating units.
28 8. In Entergys modeling of the No Action 29 Alternative:
30 A. No clean and efficient replacement capacity 31 is added in New York State (let alone Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 5
1 downstate New York City/Westchester County) 2 until 2026 and then only a relatively small 3 amount (300 MW in total) is added in the 4 years 2026 through 2040.
5 B. In Entergy's modeling of the No Action 6 Alternative most of the replacement power 7 for Indian Point is built in New England and 8 not New York State. However, no clean and 9 efficient replacement capacity would be 10 added in New England before 2025 and then 11 only a relatively small amount (110 MW) 12 would be added until 2030.
13 9. It is more reasonable to expect that the likely 14 market response would be to add some replacement 15 generating capacity before 2026 if IPEC is not 16 relicensed.
17 10. New York State is currently taking a number of 18 actions to ensure that there would be new 19 generating capacity in downstate New York if IPEC 20 is not relicensed or that there would be 21 additional transmission capability to import new 22 generating capacity (both clean and efficient gas 23 and renewable) into the downstate region. These Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 6
1 actions include the development of a New York 2 Energy Highway.
3 11. Well over 2,000 MW of clean and efficient new 4 natural gas-fired combined cycle capacity is 5 being proposed for construction in or near New 6 York City and Westchester County.
7 12. The NEMS modeling of the Baseline Analysis and 8 the No Action Alternative does not reflect either 9 the New York Energy Highway or the over 2,000 MW 10 of clean and efficient generating capacity being 11 proposed for construction in or near New York 12 City and Westchester County.
13 13. Entergys witnesses misleadingly overstate the 14 environmental impacts of the No Action 15 Alternative by understating the potential for (a) 16 substantial energy efficiency, (b) renewable 17 energy and (c) clean and efficient generating 18 capacity as alternatives if IPEC is not 19 relicensed.
20 Q. Entergys witnesses have testified that they have 21 developed two related empirical evaluations to identify the 22 environmental impacts of the generation that would likely 23 replace Indian Point Energy Center (IPEC) under the No Action Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 7
1 Alternative. 1 Do you agree that they have presented the results 2 of two empirical evaluations?
3 A. No. They present only a single empirical evaluation -
4 based on their NEMS modeling - (and that is seriously flawed as 5 I will explain). The remainder of the Entergy witnesses 6 testimony on Contention NYS-37 consists of hypothesis and 7 conjecture.
8 Q. Entergy's witnesses testify that the results of their 9 NEMS modeling show that under the No Action Alternative (1) 10 existing IPEC generation would be replaced primarily by fossil-11 fueled generation from existing natural gas and coal facilities 12 and (2) conservation and renewables would be unlikely to play 13 significant roles in replacing lost generation from IPEC. Do 14 the results of the NEMS modeling support these claims?
15 A. No. The NEMS results presented by Entergys witnesses 16 are misleading and flawed for several reasons. First, NEMS is 17 not the appropriate model to use to determine the economic and 18 environmental impacts of the No Action Alternative. Second, 19 NEMS does not accurately or fully model New Yorks 15 x 15 20 energy efficiency plan or the potential for additional energy 1
Testimony of Entergy Witnesses Donald P. Cleary, David Harrison, Jr., and Eugene T. Meehan Regarding Contention NYS-37 (Energy Alternatives), ENT000479 ("Entergy Testimony") at Answer A49 on page 34.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 8
1 efficiency above that included in the 15 x 15 plan. Third, 2 the assumption that if Indian Point Units 2 and 3 were retired 3 in 2013 and 2015, respectively, replacement capacity would not 4 be added in downstate New York until sometime in 2026 is 5 completely unrealistic in that it ignores (a) the current plans 6 being developed by New York State to add clean and efficient new 7 natural gas-fired generating capacity in the New York 8 City/Westchester region of the state and (b) the economic 9 incentives that the retirement of IPEC would create for 10 developers of new generating projects in the New York 11 City/Westchester region.
12 Q. Have you ever seen NEMS used to measure the economic 13 and environmental impacts of retiring one or two generating 14 units, as Entergy's witnesses use it here?
15 A. No. I have seen NEMS used (a) to evaluate the impact 16 of new or revised national or regional policies or (b) to 17 provide inputs (such as projected future natural gas and coal 18 prices) that have been used in plant retirement studies.
19 However, I have not seen NEMS used to evaluate the potential 20 economic and environmental impacts of retiring one or two 21 specific generating units such as Indian Point Units 2 and 3.
22 Q. In your experience is the NEMS model the appropriate 23 model to use to evaluate the economic and environmental impacts Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 9
1 of retiring Indian Point Units 2 and 3?
2 A. No. As Entergys witnesses have explained, NEMS is 3 used by the Energy Information Administration to perform policy 4 analyses in response to requests from Congress, the White House, 5 the Department of Energy, and other federal agencies. 2 The firm, 6 NERA Economic Consulting, for which Entergy witnesses David 7 Harrison and Eugene Meehan work, and other analysts, also have 8 used NEMS to model potential policy changes in other contexts. 3 9 Q. Why is NEMS an inappropriate model to use to evaluate 10 the economic and environmental impacts of retiring IPEC?
11 A. Although NEMS is a widely used model for policy 12 analysis because it seeks to replicate the entire U.S. and even 13 portions of Canada, it offers only very simplified descriptions 14 of the electric grid and the electric dispatch process in any 15 one state (New York State included). For example, generating 16 units are dispatched in NEMS for only 9 demand points or 17 segments in the year instead of all 8760 hours0.101 days <br />2.433 hours <br />0.0145 weeks <br />0.00333 months <br />. Thus, the model 18 does not provide a detailed or accurate picture of the dispatch 19 of generating units in the state. The same is true for the rest 20 of the United States. For this reason, the results of the NEMS 21 analyses presented by Entergys witnesses may be gross 2
Entergy Testimony, Answer A88 at page 72.
3 Id.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 10
1 distortions of what would actually happen if IPEC is not 2 relicensed.
3 In addition, NEMS divides the New York State electric grid 4 into only 3 zones with just a single transmission link modeled 5 between each zone. By way of contrast, NYISO divides New York 6 into 11 zones (A through K) with different transmission 7 interchange limits between the zones.
8 Q. Are there other electric system models that Entergy 9 could and should have used to better evaluate the economic and 10 environmental impacts of the No Action Alternative?
11 A. Yes. There are a number of electric system models 12 that are routinely used for capacity expansion planning analyses 13 or for examining the economic and environmental impacts of 14 retiring existing generating facilities. These models include 15 GE-MAPS, Strategist, Market Analytics, and PROMOD. These models 16 provide more detailed replications of the existing electric 17 grids and the economic dispatch of existing generating 18 facilities than does NEMS.
19 Q. Has Entergy previously used any of these models to 20 evaluate the economic and environmental impacts of retiring 21 Indian Point Units 2 and 3?
22 A. Yes. As noted by Entergy witnesses Harrison and 23 Meehan, Entergy used the GE MAPs model in a 2002-2003 assessment Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 11
1 of the potential economic and environmental impacts of an IPEC 2 shutdown. 4 3 Q. What is your opinion of the No Action Alternative that 4 Entergy has modeled with NEMS?
5 A. The No Action Alternative that Entergy has modeled is 6 not credible in any way. It assumes that there would be no 7 market or state response to replace any of the lost generation 8 from IPEC until 2026 other than through the continued operation 9 of old, dirty and inefficient coal and oil/gas steam units that 10 would otherwise have been retired by 2015.
11 For this reason, Entergy does not model a reasonable No 12 Action Alternative. Instead, it models what clearly is a worst 13 case alternative in which (a) there is very little or no new 14 energy efficiency, (b) little new renewable energy and (3) no 15 efficient and clean new capacity is added until 2026 or later.
16 Instead, Entergy models a No Action future in which old, dirty 17 and inefficient coal and oil/gas units that would be retired in 18 or around 2015 are operated as baseload facilities for an 19 additional 20 years. This is simply not a credible future.
20 Q. What have you reviewed to reach your conclusions about 21 the reasonableness of the results of Entergy's NEMS modeling of 22 the Baseline analysis and the No Action Alternative?
4 Entergy Testimony, Answer A12 at page 9.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 12
1 A. I reviewed an Excel file provided by Entergy entitled 2 "NERA_Full NEMS Output Including Unused Tables." Entergy 3 represents that this Excel file contains the full NEMS output, 4 including all the output tables that NERA used in its analysis 5 and the output tables that NERA deemed irrelevant and did not 6 use in its analysis. 5 7 Q. What is your opinion of the results of Entergys NEMS 8 modeling that purport to show there would only be a small role 9 for additional energy efficiency and conservation under the No 10 Action Alternative? 6 11 A. These results are not credible. First, contrary to 12 what Entergys witnesses imply, NEMS does not model (nor does it 13 have an easy way to model) New York States current 15 x 15 14 energy efficiency goal. Consequently, Entergys witnesses have 15 not shown that all of the low cost energy efficiency that will 16 be achieved under the 15 x 15 plan already is included in 17 their Baseline analysis and, in fact, there may be a 18 significant amount of additional low cost energy efficiency 19 available to replace IPEC beyond that reflected in that Baseline 20 analysis.
21 At the same time, the NEMS model does not treat energy 5
Exh. NYS000438 6
Entergy Testimony, Answer A85 at page 71.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 13
1 efficiency as an additional resource - that is, the only way to 2 model additional energy efficiency in NEMS is as a reduction to 3 the energy forecast. For this reason, it is not possible in 4 NEMS to directly compare the cost of continuing to operate 5 Indian Point against the cost of adding more energy efficiency.
6 As a result, as Entergy has run it, (that is, without reducing 7 the energy forecast for New York State to reflect either the 15 8 x 15 goal or the availability of other low cost energy 9 efficiency) the NEMS model could not add additional energy 10 efficiency even if it is the lower cost resource. Instead, the 11 model is limited to reflecting only a very limited amount of 12 price induced conservation.
13 Q. After reviewing the testimony and report filed by 14 Entergys witnesses on Contention NYS-37, is it still your 15 opinion that energy efficiency could play a significant role as 16 replacement energy in a No Action Alternative?
17 A. Yes. It is not a surprise that Entergys modeling 18 results do not show a major role for additional energy 19 efficiency in the No Action Alternative because (1) NEMS does 20 not model the New York State 15 x 15 energy efficiency goal 21 and (2) it is not possible to add any other low cost energy 22 efficiency in NEMS except by reducing the energy forecast which 23 Entergys witnesses have not done. For these reasons, I Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 14
1 continue to believe that energy efficiency could play a 2 significant role as replacement energy in a No Action 3 Alternative.
4 Q. What is your opinion of the results of Entergys NEMS 5 modeling that purport to show that additional renewable 6 resources would not play a significant role as replacement 7 energy in a No Action Alternative?
8 A. These results are not credible. Entergys 9 hypothetical analysis that purports to show that any additional 10 renewable resources beyond those considered in the States 30 x 11 15 plan would be more expensive is incomplete and misleading. 7 12 First, the NEMS output information provided by Entergys 13 witnesses does not show conclusively that the amount of 14 renewable energy in either the Baseline Analysis or the No 15 Action Alternative actually meets the New York State 30 x 15 16 goal.
17 At the same time, Entergys modeling of the No Action 18 Alternative ignores the possibility that there will be 19 additional low cost renewable energy above that included in the 20 30 x 15 goal. For example, Entergys NEMS modeling ignores 21 the very possibility that its own witnesses cite, that is, that 7
For example, see the discussion in Entergy's Testimony, answer A68 on pages 53 and 54.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 15
1 the completion of transmission system upgrades could unlock the 2 capability of bringing large amounts of low cost hydro generated 3 power from Canada into downstate New York. 8 Entergy also ignores 4 the very real possibility that the cost of renewable resources 5 will decrease over time, in part as the result of economies of 6 scale. Instead, all Entergys witnesses provide are some 7 theoretical graphs that are not empirically tied to actual costs 8 and circumstances in New York State.
9 Q. Will the new hydro generation capacity and energy from 10 Quebec that Entergys witnesses discuss be available whether or 11 not IPEC is relicensed?
12 A. Not necessarily. Entergy provides absolutely no 13 evidence that this additional hydro generation from Canada is 14 included as a resource either in the states 30 x 15 renewable 15 portfolio plan or in Entergys NEMS Baseline analysis. Nor do 16 they present any evidence that the delivered price of the 17 additional hydro generated power from Quebec would be more 18 expensive than any of the renewable energy that is included in 19 30 x 15 plan or the NEMS modeling. Instead, Entergy presents 20 only analytic conjecture and theoretical graphs with no 21 empirical links to New York State.
22 Q. What units does Entergy assume would not be retired if 8
See Entergy Testimony, Answer A124 on page 98.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 16
1 IPEC were not relicensed?
2 A. Entergy assumes that the following older, dirtier, and 3 less efficient coal and oil/gas steam capacity that would be 4 retired in the Baseline analysis would not be retired in the No 5 Action Alternative:
6 x 323 MW of coal capacity in Upstate New York that would 7 otherwise be retired in 2015 or 2017 8
9 x 822 MW of oil and gas steam capacity in Upstate New 10 York that would otherwise be retired in 2018 11 12 x 85 MW of coal capacity in New England that would 13 otherwise be retired in 2016 14 15 x 960 MW of oil and natural gas steam capacity in New 16 England that would otherwise be retired in 2015 or 17 2016 9 18 Q. Is there any evidence that the merchant companies that 19 own this capacity will want to keep their plants operating in 20 future years whether or not IPEC is relicensed?
21 A. No. In fact, coal units in both New York State and 22 New England have reduced their generation or have been shut down 23 as a result of competition from extremely low natural gas 24 prices.
25 Q. Based on their NEMS modeling, Entergys witnesses 26 claim that the marginal costs of generation at existing coal and 27 oil and natural gas steam generating units are lower than the 9
Exh.NYS000438 Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 17
1 costs of either (1) generating power at new natural gas fired 2 combined cycle units, (2) additional conservation beyond that 3 included in the states 15 x 15 energy efficiency plan or (3) 4 additional renewable energy beyond that included in the states 5 30 x 15 plan. From this, they argue that new, clean gas-fired 6 generation, additional conservation or additional renewable 7 energy will be more expensive and therefore less competitive in 8 New York's deregulated electricity market. Do you agree?
9 A. No. Entergys witnesses present a very misleading 10 comparison in Table 1 on page 58 of their testimony that 11 purports to show the marginal costs of generation technologies 12 that are generally capable of increasing utilization," which 13 are all fossil fuel power plants and do not include wind, solar, 14 or hydro facilities. The listed marginal costs are too low 15 because Entergy uses the heat rates of efficient new coal and 16 gas fired combined cycle and combustion turbine units to 17 calculate the marginal costs of the existing coal and natural 18 gas steam units that NERA assumes will run more if IPEC is not 19 relicensed. However, these existing units generally are less 20 efficient than new natural gas combined cycle units and the heat 21 rates of these older, less efficient units are more probably 22 above (perhaps significantly above) 10,000 btu/kwh than in the 23 7-8,000 btu/kwh range assumed by Entergy in the derivation of Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 18
1 the marginal costs in Table 1. Therefore, the marginal costs of 2 existing fossil fuel units are higher per megawatt hour than the 3 figures shown in the table and they would be less competitive 4 than Entergy asserts.
5 Q. When would new generation capacity be added under Entergys 6 No Action Alternative?
7 A. Figures 1 and 2, below (taken from the outputs for 8 Entergys NEMS modeling) show the cumulative megawatts of 9 capacity added in New York State and New England under Entergys 10 Baseline analysis (Figure 1) and the No Action Alternative 11 (Figure 2). Figure 3 then shows how much capacity is added 12 under the No Action Alternative above that which would be added 13 in the Baseline analysis. This represents the capacity added as 14 a result of the retirement of Indian Point Units 2 and 3.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 19
1 Figure 1: Cumulative Capacity Additions After 2012 in New York 2 State and New England in Entergys Baseline Analysis 5000 4500 4000 3500 3000 Megawatts 2500 2000 1500 1000 500 0
NYC/Westchester Long Island Upstate New York New England 3
4 5
6 7
8 9
10 11 12 13 14 15 16 17 18 19 Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 20
1 Figure 2: Cumulative Capacity Additions After 2012 in Entergys 2 No Action Alternative 5000 4500 4000 3500 3000 Megawatts 2500 2000 1500 1000 500 0
NYC/Westchester Long Island Upstate New York New England 3
4 5
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 21
1 Figure 3: Cumulative Megawatts of Replacement Capacity Added in 2 NEMS No Action Alternative above That Added in Baseline Analysis 1800 1300 Megawatts 800 300
-200 New York State New England 3
4 Q. What do Figures 1, 2 and 3 reveal about the results of 5 Entergys NEMS modeling of the No Action Alternative?
6 A. In Entergys NEMS modeling of the No Action 7 Alternative:
8 x No clean and efficient replacement capacity is added 9 in New York State (let alone New York City and/or 10 Westchester) until 2026 and only a relatively small 11 amount (300 MW in total) is added in the years 2026 12 through 2040.
13 x No clean and efficient replacement generating capacity 14 would be added in New England until 2025 and then only Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 22
1 a relative small amount (110 MW) of new capacity would 2 be added between 2025 and 2030. 10 3 Although this result is not reflected in Figure 4, remarkably, 4 the results of Entergys NEMS modeling projects that more new 5 generating capacity would be built in Upstate New York in the 6 Baseline analysis than under the No Action Alternative.
7 Q. Is it reasonable to expect that any significant 8 portion of the replacement capacity that would be added if IPEC 9 is retired would be built in New England?
10 A. No. It is more reasonable to expect that replacement 11 generating capacity would either be built (1) in the downstate 12 New York region or (2) in Upstate New York rather than in 13 unspecified locations in New England.
14 Q. What do you believe would be the likely market 15 response to the retirement of Indian Point Units 2 and 3?
16 A. It is reasonable to expect that current or new market 17 participants would seek to add new capacity in New York City or 18 Westchester County close to the downstate loads. Given the 19 current and projected low costs of natural gas, and the 20 financial risks faced by new coal plants, I believe that the new 21 generating capacity that would be added would be clean and 22 efficient natural gas combined cycle units. Indeed, new 10 Exh.NYS000438 Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 23
1 efficient natural gas combined cycle units have been added in 2 New York City within the past decade and other proposed combined 3 cycle units were licensed by the state to be built in downstate 4 New York but were unable to obtain needed financing. It is 5 reasonable to expect that IPECs retirement would facilitate the 6 licensing of new replacement generation projects.
7 Q. What actions is the State of New York currently taking 8 to ensure that there would be new clean and efficient natural 9 gas-fired or renewable generating capacity added in downstate 10 New York or that there would be additional transmission 11 capability to import new generating capacity into the downstate 12 region?
13 A. The State has taken a number of actions that can be 14 expected to lead to efficient and clean new generation being 15 built in or imported into downstate New York. First, the Power 16 New York Act of 2011 established a process for the siting of 17 electric generating facilities and repowering projects. Second, 18 the State has started the process for developing an Energy 19 Highway plan that will include (1) building new transmission 20 lines or rebuilding and upgrading existing ones; (2) repowering 21 aging power plants to increase their efficiency and making them 22 more environmentally friendly and (3) building new plants 23 including those powered by natural gas and by wind and other Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 24
1 renewable fuels. 11 The State has explained that:
2 While taking action to reduce demand through the 3 States on-going energy efficiency initiatives 4 remains critical to the current and future 5 sustainable energy system, this initiative 6 focuses on supply-side and infrastructure 7 projects that generate and transmit energy. 12 8
9 The specific objectives of the Energy Highway are to:
10 x Reduce constraints on the flow of electricity into, 11 and within, the downstate area; and expand the 12 diversity of power generation sources supplying 13 downstate 14 x Assure that long-term reliability of the electric 15 system is maintained in the face of major system 16 uncertainties 17 x Encourage development of utility-scale renewable 18 generation resources throughout the state 19 x Increase the efficiency of power generation, 20 particularly in densely populated urban areas. 13 21 The current schedule calls for the States Energy Highway Task 22 Force to develop an action plan sometime in the summer of 2012.
23 Q. Are clean and efficient new generation facilities 24 being proposed for in or near downstate New York?
25 A. Yes. A number of new projects representing well over 26 2,000 MW of clean and efficient generating capacity have been 27 proposed for completion in and near New York City in the years 11 New York Energy Highway Request for Information, at page 4, www.nyenergyhighway.com/Content/pdf/EH_RFI/Brochure_2012.pd f
12 Id.
13 Id. at page 11.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 25
1 2014-2017:
2 x NRCs Berrians GT I, II and III project involving the 3 addition of 580 MW of natural gas-fired capacity in 4 New York City 5 x The CPV Valley Energy Center in Orange County 6 involving 650 MW of natural gas -fired combined cycle 7 capacity 8 x US Power Gens Luyster Creek Energy Project in New 9 York City involving 400 MW of natural gas-fired 10 combined cycle capacity 11 x The Cricket Valley Energy Center located east of 12 Poughkeepsie, New York which would add 1000 MW of new 13 natural gas-fired combined cycle capacity.
14 Q. Does Entergys NEMS Baseline or No Action Alternatives 15 include the New York Energy Highway or any of these proposed 16 facilities?
17 A. No.
18 Q. You testified earlier that in Entergys No Action 19 Alternative, clean new replacement generating capacity would not 20 be added in the New York City/Westchester region until 2026 and 21 in New England until 2025. Does the discussion of the 22 environmental impacts of the No Action Alternative by Entergys 23 witnesses address the impact of adding this clean new 24 replacement capacity?
25 A. Not surprisingly, Entergys witnesses discuss only the 26 environmental impacts of not relicensing IPEC in the years 2016-Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 26
1 2025. 14 This is significant because under Entergys No Action 2 Alternative only a very small amount of clean and efficient 3 replacement capacity would be added in New York State during 4 this period and a mere 46 MW of clean and efficient replacement 5 capacity would be added in New England. Entergy also adds only 6 a little bit more energy conservation and barely any additional 7 renewable energy. Instead, Entergy assumes that the great bulk 8 of the replacement energy would come from the continued 9 operation of existing inefficient and dirty coal and oil/gas 10 steam units. 15 Consequently, it is no wonder that Entergy 11 concludes that there would be significant environmental impacts 12 as it has excluded all clean sources of replacement energy.
13 Q. Does this complete your testimony?
14 A. Yes.
15 I have reviewed all the exhibits referenced herein. True 16 and accurate copies are attached.
17 14 For example, see Entergy Testimony, Table 8 on page 80.
15 As shown in Entergy Testimony, Table 7 on page 78, 43.1% of the replacement energy would come from coal and 55.9% from existing gas and oil units.
Pre-filed Rebuttal Testimony of David Schlissel Contention NYS-37 27
1 UNITED STATES 2 NUCLEAR REGULATORY COMMISSION 3 BEFORE THE ATOMIC SAFETY AND LICENSING BOARD 4 ------------------------------ - ---- x 5 In r e: Docke t Nos . 50 -24 7 - LRi 50 -2 86-LR 6 License Renewal Application Submitted by AS LBP No . 07 - 858 LR - BDOl Entergy Nuclear Ind i an Po i nt 2, LLC ,
8 Ente r gy Nuclea r Indian Point 3 , LLC , and Ente r gy Nuclea r Ope r atio n s, Inc .
10 -----------------------------------x 11 DECLARATION OF David A. Schlissel 12 I, David Schlissel, do hereby declare under penalty of 13 perjury that my statements in the foregoing testimony and my 14 statement of professional qualifications are true and correct to 15 the best of my knowledge and belief.
16 Executed in Accord with 10 C.F.R. § 2.304(d) 17 ~~]tJ. f~ 7 18 David A. Schlissel 19 45 Horace Road 20 Belmont, MA 02478 21 Davi d@S ch l is sel -T ec hni ca l. com 22 617 - 489 -4 840 23 24 June 29, 2012 Pre - fil ed Reb utt a l Testimony of Dav i d Schli s sel Contention NYS-37 28