Rochester Gas and Electric has reached an agreement with the Ginna nuclear power plant where it’ll subsidize the plant’s operation through September 2018. The proposed contract will cost RG&E customers, but it’s not clear just how much.
RG&E and Exelon have filed their proposed contract
with the state Public Service Commission, which has to approve it. The PSC, which is New York’s utilities oversight board, ordered the negotiations in the first place. It said Ginna’s power is necessary to ensure reliable electricity supply for RG&E and its customers. And when the Exelon subsidiary that owns Ginna filed a petition requesting the contract it claimed that without it, it’d move to close the plant.
Ginna’s owner says the plant lost more than $100 million over the past three years. And during those years, Ginna was selling 90 percent of its electricity to RG&E under a contract, often at above market rates. When that contract expired last year, Ginna had to start selling its power in New York’s competitive market, and it was receiving a lower price for its power.
The new contract is different, and somewhat complicated. In simple terms, RG&E has agreed to pay Ginna $17.5 million a month for the next three and a half years. Ginna will sell its power into the state’s marketplace and then rebate 85 percent of those revenues to RG&E. So each month, the utility company will actually pay substantially less than $17.5 million.
In its PSC submission, RG&E says an average residential customer using 600 kilowatt hours a month would see an average bill increase of $3.89 per month, or 4.2 percent. But the actual cost will vary depending on the price Ginna gets for its electricity.
Alliance for a Green Economy, a group that opposes nuclear power and the proposed Ginna agreement, says the PSC should force RG&E to absorb the cost of the contract. The company should have been planning for Ginna’s retirement, the group says in a press release. And Ginna should be replaced with transmission improvements and clean energy.