Consensus Economic Impact Report Of Vermont Yankee Scenarios
It is going to be a short post – I was up way too late last night watching a scrappy little college team take one of the elite programs in all of college basketball all the way to the wire in the National Championship game. Congratulations to both teams for an excellent game.
The report commissioned by the Vermont Legislature on the economic impact of various scenarios associated with the continued operation (or not) of Vermont Yankee has been released. You can find the Executive Summary at Consensus Economic and Fiscal Impact Analyses Associated with the Future of the Vermont Yankee Power Plant.
This is a document that Vermont voters should read, though it’s conclusions are not as clearly stated as they could be. Here is a summary statement found on pages 8-9 of what might happen to the state economy if Vermont Yankee is shut down. Please note that the consultants were tasked with determining the effect on Vermont only:
In the VY Shutdown Scenario:
1) Negative plant shutdown employment impacts are likely to be at about -1,060 jobs (2013-2031 average), relative to the VY Relicense scenario, and prior to SAFSTOR, and at about -950 jobs with the implementation of the SAFSTOR decommissioning option over the period 2013-2031. Secondary indirect and induced economic impacts would be higher, except for the fact that nearly 60% of VY employees reside (and spend most of their personal income)outside of Vermont – primarily in NH and MA.
2) Even assuming replacement power at market prices, the retail power bill is likely to be higher in the event of plant closure, resulting in additional negative economic impacts. Power bill impacts associated with the plant shutdown will further reduce employment by about 120 jobs per year and output by more than $15 million per year in 2012 dollars.
3) Revenue Sharing Agreement impacts, estimated at the low end of the possible range (55%) leave the VY Shutdown scenario about 120 jobs per year below the VY Relicense scenario, during the relevant 11 year effective RSA period from 2013-2023.
4) Total VY Shutdown scenario impacts, relative to the Relicense scenario, result in about 1,100 fewer jobs per year and real disposable personal income levels more than $60 million per year (in 2012 dollars) below VY Relicense levels between 2013 and 2031.
No wonder Peter (Germany gets 30% of its electricity from solar) Shumlin called the vote on the plant certificate of public good before the study was released and its results digested and discussed.
Yes. but think of what a windfall in profits this will be for Hydro-Quebec! [/sarcasm]
I’m not exactly neutral on this issue, because if past practice is any indication, Hydro-Quebec has used the excuse that domestic rates must be based on total market price, thus the more they charge for exported power, the more they will charge at home.
Hmm. Without disclosing it, you only referenced the worst case employment scenario. If instead you had included mention of study’s so-called Green Scenario, you would have honestly shared with your readers the dramatic benefits of retiring the aging plant as scheduled in 2012 coupled with aggressive development of sustainable energy alternatives — which the economists concluded “1) Provides, on average, comparable employment levels relative to the VY Relicense scenario during the first decade of the analytic period and then rapidly outpaces the VY Relicense scenario over the final 17 years. Annual employment differentials relative to the VY Relicense case exceed 2,600 jobs by the end of the forecast horizon in 2040. 2) Retail power bills in the Green scenario are generally higher than most other scenarios in the initial 5+ years, but are substantially lower in the out years as consumers buy less power and competitive power source fuel prices (driven by projected fossil fuel price increases and national greenhouse gas limits), increase substantially in real terms. Even with additional negative RSA impacts through 2023, beneficial power bill impacts will eventually result in
more than 1,000 jobs per year by 2040.”
Retail power bills in the Green scenario are generally higher than most other scenarios in the initial 5+ years, but are substantially lower in the out years as consumers buy less power and competitive power source fuel prices (driven by projected fossil fuel price increases and national greenhouse gas limits), increase substantially in real terms.
Well, that would be clearly soooo much better than having the plant continue to operate and produce cheap electricity with no GHG emissions.
Here’s a clue: Power will never be cheaper under green regulation. Never. “Using less power” will only happen if power is more expensive.
VermontDad – My concerns about the closure of Vermont Yankee are not limited to the direct employment effects for the state of Vermont. The quote that I published noted that fully 60% of the effects would be mostly felt outside of the state, that there would be substantial increases in the cost of electricity, and that there would be a loss of income to the state of about $60 million per year.
I freely admit that I am not a resident of the state or even of the area, but many members of the opposition to the continued operation of the plant have rightly pointed out that the battle is an example with national and even international implications.
As a career American military officer, I have little or no interest in “state’s rights” when the issue is one that crosses state borders. Energy production sources is one such issue where our Constitution clearly puts a lot of power into the hands of the Federal government because of the competing state interests that must be resolved equitably.
I am much more interested in what is good for the entire country and even what is good for the rest of the world. Shutting down well maintained and well operated nuclear power plants with a lot of remaining life in them in favor of increasing the rate of fossil fuel combustion is a dumb idea. It will make the world a dirtier and poorer place, even if a few people are employed at great expense to the rest of us to construct the replacement power facilities.
Which is wishful thinking.
Massachusetts passed the Green Communities Act back 2 years ago. Employment has increased in the “Green Power” sector, but ultimately, the “Green Power” sector, since it really has not generated much power at all, green or otherwise, has probably has resulted net job losses for the Commonwealth. (It certainly has not generated enough power to lower rates by the amount that rates have increased to support “Green Power”, I will say that much.) This is, of course, because wind and solar photovoltaic are inherently unreliable and unsuitable for deployment on any grid, brilliant, smart or dumb. Little or no “Green Communities” money has been spent on things that actually work (even those that work in a marginal fashion) like solar thermal (great for pool heating and decreasing oil bills, but electricity generation? Come on.), deep geothermal (causes earthquakes), or biomass (burning trees).
The main money savings in the Commonwealth with electricity has been in increased efficiency, which does work, because it allows you to do more with less – and therefore, to do more with more. This is not the result of “Green Power” but because of programs, subsidies, and financing offered by the utilities themselves, as power plant construction is nearly impossible in Massachusetts; therefore, Massachusetts utilities want to reduce demand as they aren’t getting any more supply. These utility-initiated programs have been highly successful. There are few 60 watt incandescent bulbs left in the Commonwealth, yet our buildings are lighted better than ever. Our refrigerators and freezers use less power, allowing more electrical equipment to be purchased with the savings. More invisible servants have been hired – and with those invisible servants, more visible workers have been hired. Not enough to compensate for the devastating economic situation, but we will survive.
There is much to do in terms of efficiency in Massachusetts (especially in those uninsulated gas-heated 150 year old houses; I do know that the gas utilities are just begging for the opportunity to sell less gas, just as the oil marketers are looking to help Massachusetts families $AVE on their OILHEAT bills!) but eventually, the point of diminishing returns will be reached. Of course, that means new energy sources will have to be deployed.
This might mean, for instance, finishing Seabrook II or firing up Millstone I again, or even converting that old coal-burner down Mount Tom way over to a clean HTGR-powered steam plant, no matter what the Clam$hell Coal-a-lition, no, I mean, Clamshell Coalition has to say about it.
The Green Communities Act – and “green jobs” – will not help us there. They don’t produce “green” – except green, as in money, for builders of white elephants.
Just as Vermont will positively be producing green if it shuts down Vermont Yankee. Lots and lots of green for the GAS companies, who are well known to have given kickbacks to so-called environmental groups in Vermont (environmental groups who just so happen to want to close Vermont Yankee) while building their new natural-gas fired plants (770 MWe) which just happen to be over the state line in New Hampshire, I believe. I forget which environmental group that was that accepted the GAS kickback, but I can imagine it was for a lot of money.
You can create infinity jobs by just ordering people to dig holes and fill them back up again. You don’t just want jobs, you want high-paying, economically useful jobs.
I agree with the last post – remember we’re just talking about electricity, something we used to take for granted before the “green” debate started. And with all the electric vehicles that are coming on the market in the coming years, should they be successful, electricity demand is going to increase massively (as oil demand drops), so we need all the power we can get.
VermontDad, the benefits of the Green scenario are almost completely independent of the VY_Shutdown option. I recommend that you look at the graphic on p9 of the pdf, which shows pursuing both relicensing and green initiatives has a doubly beneficial effect. Also note that for significant portions of the next fifteen years, the Green+VY_Shutdown effects are worse than No_Green+VY_Relicence.
Since we’re talking about honesty – why didn’t you highlight the Green+Relicence option?
I would also urge you to consider the meaning of “efficiency”. Part of this is getting more out of what you already have – in the case of Vermont Yankee, it means using the infrastructure that’s already there rather than building more.
And the capacity factor of these windmills are? I hope Vermont Dad has a coal oil lamp and a wood stove, he will need it on those calm cold nights when he cannot even run his gas/oil furnace. Buy the lamps and coal oil now, they will be expensive in a few years. The ones with the “Aladdin” mantels are the brightest. They were available in the 70’s in northern Vermont/NH, not sure if you can still find them. You may want to get a holding tank for water so you can flush.