CAN THE FUTURE COME FAST ENOUGH FOR NUCLEAR? SCOTTMADDEN, INC. | 40 Difficult markets pressure the industry to streamline operations and pursue new technologies. Despite Closures, Total Nuclear Capacity Scheduled to Increase by 2020 • Sustained low natural gas prices, capacity markets that some say do not compensate for nuclear’s full value as clean baseload generation, and the high cost of operating a single- unit plant are pressuring nuclear plant operators to consider early plant retirements • A pocket of hope for new nuclear capacity is the Southeast, which continues to push new reactors toward completion, although the learning curve has proven more costly than expected • Despite its profitability and $1.6 billion in annual economic output statewide, New York Governor Cuomo has repeatedly called for retirement of Entergy’s Indian Point nuclear plant due to “intolerable” operating performance and proximity to NYC. Some cry foul saying the NRC has sole jurisdiction over nuclear safety • In stark contrast, Governor Cuomo has expedited the creation of zero-emission credit subsidies in order to exclusively support the continued operation of Entergy’s unprofitable upstate FitzPatrick nuclear plant. Governor Cuomo had earlier criticized Entergy for seeking similar subsidies • Entergy responded by reaffirming that FitzPatrick will be decommissioned, thus dealing Governor Cuomo’s emission reduction plan a major blow -Stephen Kuczynski CEO, Southern Nuclear Operating Co. Selected Nuclear Plants Under Construction, Under Pressure, or Annouced Retirement Ginna (PWR) 582 MW Units: 1 N/A FitzPatrick (BWR) 847 MW Units: 1 Late 2015-Early 2017 Pilgrim (PWR) 677 MW Units: 1 Mid-2019 Spot Natural Gas Prices at Selected Northeast Hubs (March 2011-March 2016) $30 Indian Point 2-3 (PWR) 2,069 MW Units: 2 N/A $25 $/MMBtu The NY Nuclear Debate: Tensions Are High We need to build new reactors early in the next decade, demonstrate them through the 2020s, and scale up by the 2030 time frame $20 $15 Watts Bar 2 (PWR) 1,150 MW* Units: 2** 2016 $10 $5 $0 3/2011 3/2012 Algonquin Citygates 3/2013 3/2014 Transco Zone 6 (Non-NY) 3/2015 3/2016 Tennessee Zone 5 Plant Name 2014 Net Summer Capacity (MW) (*incremental new capacity) # of units at plant (current or **upon completion of new construction) Online/retirement date (as applicable) Vogtle 3-4 (PWR) 2,234 MW* Units: 4** 2019/2020 Announced Retirement Under Pressure Expected Additions Oyster Creek (BWR) 615 MW Units: 1 2019 V.C. Summer 2-3 (PWR) 2,234 MW* Units: 3** 2019/2020 BWR: Boiling Water Reactor PWR: Pressurized Water Reactor Sources: NEI; EIA; IAEA; NRC; SNL