Why We’re Taking a Hard Look at Nuclear Power Plant Closures

Posted on November 13, 2018 by Kenneth Kimmell

Last month the Intergovernmental Panel on Climate Change (IPCC) issued a sobering report. Based on the most up-to-date scientific evidence, the report warns that we are rapidly losing any appreciable chance of meeting the Paris climate agreement goal of keeping temperature increases to “well below” 2 degrees Celsius above pre-industrial levels.

The report also makes clear that if we fail to meet this goal, the consequences will not only be severe, but they will be experienced sooner than expected. (For more information on the IPCC report, see our blog series)

In stark defiance of science, here in the United States the federal government has abdicated its leadership role and is now taking a wrecking ball to the pillars of progress—the Clean Power Plan, our nation’s first limits on CO2 from power plants; fuel economy/greenhouse gas emission limits for cars and trucks; and rules to limit methane emissions from oil and gas operations.

While a number of states, cities, businesses, universities and others have stepped up admirably, many observers have concluded that there is a high degree of uncertainty about whether we will meet or even get close to the pledge we made as part the Paris Agreement—a 26 to 28 percent reduction from 2005 levels by 2025. This graph, adapted from a study performed by the Rhodium Group, depicts this:

US projected emissions compared to the US Paris pledge. Source adapted from Taking Stock 2018, Rhodium Group

These sobering realities dictate that we keep an open mind about all of the tools in the emissions reduction toolbox—even ones that are not our personal favorites. And that includes existing nuclear power plants in the United States, which currently supply about 20 percent of our total electricity needs and more than half of our low-carbon electricity supply.

A new UCS report, The Nuclear Power Dilemma: Declining Profits, Plant Closures, and the Threat of Rising Carbon Emissions, indicates that more than 22 percent of total US nuclear capacity is unprofitable or scheduled to close over the next five to 10 years. The report also indicates that without new policies, the electricity generated by these and other marginally economic nuclear plants is likely to be replaced in large part with natural gas-fired generation (although this will vary from plant to plant). If this occurs, cumulative carbon emissions in the electric sector could increase by up to 6 percent between 2018 and 2035.

While a 6 percent increase in emissions doesn’t sound that sizable, emissions from the electric sector must decrease, rapidly and substantially. The National Research Council has found, for example, that power plant emissions must decrease by 90 percent by 2040 to meet US climate goals.

Most of that reduction will be achieved by using electricity more efficiently, expanding increasingly cheap solar, wind, and energy storage, modernizing our grid, and building more transmission lines to connect these renewable sources to load centers. We are counting on these approaches to replace capacity as coal plants close; cut down on an overreliance on natural gas in the short term and displace it over time; and increase overall electricity supply to pave the way for the electrification of transportation, space and water heating, and industrial processes.

But if nuclear power plants close prematurely, we add a fourth task—replacing lost nuclear capacity. While efficiency, renewables, transmission and storage may be up to the task, governments must adopt policies that assure that we will decarbonize even if these resources fall short of our expectations.

Factoring all of these considerations in, our new report calls for proactive policy to preserve nuclear power from existing plants that are operating safely but are at risk of premature closures for economic reasons or to ensure that lost nuclear capacity is replaced with carbon-free sources.

The best policy is an across-the-board national carbon price, which UCS has been advocating for years. Another policy solution that hasn’t received as much attention is a national low carbon electricity standard. This policy builds on the success of state renewable electricity standards but would include other low or zero carbon energy technologies. Either option would help the existing nuclear fleet, substantially boost solar and wind energy, and substantially decrease natural gas and coal use, while reducing US power sector carbon emissions by up to 28 percent cumulatively by 2035. These are durable policy solutions. Rather than a temporary fix that throws money at the problem, these policies address a systemic market failure that will help level the playing field for nuclear and other low carbon technologies in the long-run.

In the absence of national carbon price or low carbon electricity standard, the report calls upon states—which have plenary authority over the electric sector—to take proactive measures of their own. For example, California’s strong renewable energy and energy efficiency standards and climate policies mean that it can likely replace the Diablo Canyon nuclear facility by 2025 with clean energy and continue to drive down emissions. New York, Illinois and New Jersey have all adopted policies to provide financial support for distressed nuclear power plants that value their carbon-free power attributes. At the same time, these states have boosted renewables and efficiency, and sought to ensure that preserving existing nuclear power does not in any way undermine expansion of renewables.

The UCS report does not argue for subsidies for any specific plants. That case will have to be made in state-specific forums. Should states decide to support nuclear power plant subsidies, our report calls for them to be temporary and subject to periodic reassessment. And companies seeking subsidies must open their books and allow the public and regulators to make sure that the subsidies are needed and cost-effective, and that the same level of carbon free power cannot be provided during the relevant time period with less costly options.

Finally, our report makes clear that we would never support financial assistance that is tied to also subsidizing fossil-based energy sources, such as the rumored Trump administration proposal to bailout coal and nuclear plants based on spurious national security grounds.

Our report also factors in the critical issue of nuclear safety. Since its founding, UCS has been deeply concerned about the risks posed by nuclear power. An accident or terrorist attack at a US nuclear reactor could severely harm public health, the environment, and the economy. For this reason, UCS has worked as a nuclear power safety and security watchdog for more than 40 years. Consistent with our longstanding advocacy for nuclear safety, subsidies should be considered only for plants that at a minimum earn the highest safety rating from the Nuclear Regulatory Commission. This ensures that subsidies are not used to correct safety problems caused by bad management and gives under-performing plants an incentive to improve to be eligible for subsidies. And our report in no way backtracks from our longstanding insistence that there be strict oversight from the Nuclear Regulatory Commission, and that nuclear power plant operators continue to make their plants safer by expediting the transfer of spent fuel to dry casks, bolstering emergency management procedures, increasing emergency planning zone sizes, and other measures outlined in numerous UCS reports, including Preventing an American Fukushima.

Nuclear power plants are controversial, for legitimate reasons. But the IPCC report reminds us that we are running out of time and will have to make hard choices. Preserving the capacity of safely operated nuclear plants or ensuring that this capacity is replaced with zero carbon alternatives is an imperative that cannot be ignored.

Energy Storage and Transforming The Grid in New York

Posted on March 21, 2017 by Virginia C. Robbins

For those who support national and international climate change initiatives like the Clean Power Plan and the Paris Agreement, the news out of Washington is gut-wrenching.  Disengaging from these initiatives is harmful on geo-political, economic, and moral grounds.  Despite these expected actions by the current administration, there is good news in the renewables sector:  battery storage technology has the potential to be a strong contender in the fight against climate change. 

In October 2015, a leak at the Aliso Canyon gas storage facility outside Los Angeles caused it to shut down.  The leak reduced fuel supplies for area power plants.  In response, the California Public Utilities Commission (CPUC) mandated mitigation measures, including the expedited procurement of about 100 megawatts (MW) of local energy storage resources in the Southern California Edison (SCE) and San Diego Gas & Electric (SDGE) service territories.  Renewable and other types of energy stored during the day would be available when electricity demand increased in the evening, thereby avoiding the need for increased fossil fuel generation to serve that peak need. 

The CPUC order directed utilities in Southern California to identify storage projects that could be sited, constructed, and put into operation providing electricity to the grid in only a few months.  Within 6 months after the CPUC issued its order, two battery storage facilities were completed.  SDGE contracted for the installation of two energy storage projects totaling 37.5 MW.  The larger 30 MW project in Escondido is said to be the biggest lithium ion battery storage facility in service on a utility grid in the world and is capable of serving 20,000 customers for four hours.  Also, Tesla completed a battery storage facility for SCE at the Mira Loma substation capable of powering about 15,000 homes for four hours.

These California energy storage projects are providing valuable “lessons learned” about the efficiency of battery technology, its benefits and limitations.  For example, building on these lessons, New York has established aggressive goals for meeting its electricity needs through renewable sources.  New York’s Governor Cuomo established a goal for 50 percent of the state’s electric needs to be met by renewable sources by 2030.  The strategy is to transform New York’s electric industry by building a cleaner, more resilient and affordable energy system through investment in clean technologies like solar, wind and energy efficiency.  And because wind and solar sources cannot always generate power during times of high electricity demand, energy storage must be a key component of the state’s energy future and more needs to be done for system operators to understand it and to develop the business models that will work.      

In October 2016, the New York Department of Public Service issued a Staff Report and Recommendations in the Value of Distributed Energy Resources Proceeding.  The goal of the proceeding is to develop accurate pricing for clean distributed energy resources (DERs) that reflects the actual value created by technologies that produce power outside of the utility grid (e.g., fuel cells, microturbines, and photovoltaics) and technologies that produce power or store power (e.g., batteries and flywheels) as well as demand-side measures.

The staff report supports including projects that pair any energy storage technology with an eligible generation facility to receive compensation under a proposed tariff.  The report also identifies a utility-driven demonstration project supporting solar-plus-storage.  Consolidated Edison Company of New York is currently pursuing a demonstration project that combines multiple solar plus storage systems to improve grid resiliency and provide a dispatchable “virtual power plant” that Con Edison can control and rely on in real time.  Con Edison is also pursuing grid-scale energy storage through a request for information seeking to demonstrate how large-scale utility storage can improve company operations, and establish how a singular type of energy storage can offer multiple kinds of value.   

Also, at its March 9, 2017 session, New York’s Public Service Commission (PSC) enacted a new compensation structure to value DERs installed in New York.  The order establishes compensation values for the first time in New York for energy storage (battery) systems when combined with certain types of DERs.  In addition, the PSC directed the state’s utilities to significantly increase the scope and speed of their energy storage endeavors.  By the end of 2018, each utility must have deployed and begun operating energy storage projects at no fewer than two separate distribution substations or feeders.  The Commission tasked the utilities with striving to perform at least two types of grid functions with the deployed energy resources, for example, increasing hosting capacity and peak load reduction.  The Commission stated that these actions are both feasible and necessary to promote timely development of a modern grid capable of managing DERs.   

These developments promise good outcomes for the deployment of energy storage, for environmental protection and for consumers.  They may also play a role in the planned shutdown (by 2021) of the Indian Point nuclear power facility, that has the capacity to generate more than 2000 MW of electricity and that serves about 25% of the energy needs of New York City and Westchester.  At a recent legislative hearing on the Indian Point shutdown, state officials discussed making up for the lost energy by efficiency programs and by encouraging opportunities for renewable, non-polluting sources like solar, wind and hydropower.  Their focus on renewables bodes well for further investment in energy storage as a component of reliable service using a resilient distribution system.  The battery storage “lessons learned” in Southern California in resolving the gas leak crisis may be valuable to New York State in planning for the shutdown of Indian Point.