Where is U.S. Nuclear Heading?
By Jim Vess
Pacific Gas & Electric just announced it will no longer seek extension of the operating licenses for the Diablo Canyon reactors. Instead choosing to shut Unit 1 down in 2024 and Unit 2 in 2025, when their current operating licenses expire. The utility plans to replace plant’s 2,240 MW output with a combination of renewable energy, efficiency and energy storage.
At the beginning of June, Exelon announced that it plans to shut down the Clinton and Quad Cities nuclear plants in Illinois after failing to get any legislative support for the money-losing assets. The utility said that, despite good operational performance, the two plants have lost $800 million combined in the last seven years. Clinton is set to close June 1, 2017 and Quad Cities will follow on June 1, 2018. Exelon said it decided to close the plants after state lawmakers declined to approve legislation that included subsidies for nuclear power as a zero-carbon energy source.
Also in June, the board of directors of Omaha Public Power District (OPPD) voted unanimously to retire the Fort Calhoun nuclear station by the end of the 2016. The board determined that closing Fort Calhoun is in the best financial interest of OPPD. Mothballing the plant is expected to save almost $1 billion over the next 20 years. OPPD plans look at resource options, including construction of new natural gas plants, wind and solar generation, and increasing demand side management.
Entergy shut down the Vermont Yankee Nuclear Power Plant in 2014. It also plans to shut down the James A. FitzPatrick plant in upstate New York by early 2017 and the Pilgrim Nuclear Generating Station in Massachusetts in 2019. All of these closures are due to economic pressure, according to Entergy.
Oyster Creek, one of the oldest operating commercial nuclear power plants in the United States is set to retire ahead of schedule. The plant first came online on December 1, 1969, and is licensed to operate until April 9, 2029, but Exelon has decided to permanently shut down the plant by December 31, 2019.
One would have thought nuclear power plants, which produce large amounts of carbon-free baseload power, would logically be a big part of the Obama administration’s Clean Power Plan (CPP). Unfortunately, that is not the case. OPPD pointed out, when announcing Fort Calhoun’s closure, that the CPP does not give carbon-free generation credit for existing nuclear plants. Apparently, existing nuclear generation was not included in the CPP because current demand can be met without them, according to the EPA. However, currently under-construction and future nuclear will be given credit.
The low cost of natural gas combined with the unfavorable status of existing nuclear in the CPP has made it uneconomical to keep some plants in some markets operating.
Ralph Izzo, CEO of PSEG may have said it best, “Where the market is failing, is in the well-intentioned government intrusions to achieve certain policy objectives that have significant implications for power markets. But people don’t think through what those implications are.”
“So you’ve created a system where, in the interest of reducing carbon, you’re going to shut down nuclear plants that you replace with natural gas. They had the best of intentions with a really bad outcome,” he added.
While nuclear appears to be on the way out in some markets, it is thriving in other places. In the southeastern United States, there are new reactors under construction. In Tennessee, TVA’s Watts Bar Unit 2 is currently undergoing power ascension testing and is expected to begin commercial operation later this summer. Southern Company is two Westinghouse AP1000 reactors, Plant Vogtle Units 3 and 4, in Georgia. They are expected to be operational in 2019 and 2020. SCANA also has two AP1000 reactors under construction in South Carolina at its Virgil C. Summer Nuclear Generating Station.
In the West, Blue Castle Holdings Inc.is looking to build two AP1000 reactors in Utah. Also in Utah, Idaho and other western states, NuScale Power, LLC is seeking to build its small modular reactor (SMR).
While it may look like doom and gloom for nuclear in some regions of the United States, it is still alive and well in others.