A recent report by IHS CERA demonstrates that existing nuclear energy plants, which provide one-fifth of the country’s electricity and are part of a diverse energy mix, help lower the cost of generating electricity for consumers by more than $93bn a year.
A diverse energy mix helps consumers by producing lower and less volatile power prices, among other economic benefits, the nuclear industry support group Nuclear Matters noted in a July 28 statement about the study. Currently, these economic benefits may be threatened as a result of premature nuclear energy plant closures, emphasizing the need to preserve these valuable assets and prevent an over-reliance on any one generation source.
The study, “The Value of US Power Supply Diversity,” also quantifies the impact of reduced energy diversity on the U.S. and on other aspects of the economy. Notably, the study concludes that with reduced energy diversity, average wholesale power prices would increase by about 75% and retail power prices would increase by 25%. The effect of these price increases would reduce U.S. gross domestic product by nearly $200bn, result in one million fewer jobs and decrease a typical household’s annual disposable income by about $2,100.
Some existing nuclear energy plants face economic and policy challenges that threaten continued operation. Within the past year, four nuclear reactors have been announced to close prematurely due to these conditions, despite the fact that they have years of useful operating life remaining.
“The IHS study clearly demonstrates that diversity in power generation is a critical factor in ensuring cost-effective electricity prices for consumers and our economic prosperity,” said former U.S. Senator Evan Bayh, co-chair of Nuclear Matters. “Yet the need for an energy strategy that includes a variety of generation sources tends to be taken for granted in this country, which is perhaps why our nation’s existing nuclear energy plants find themselves in the bind they’re in today. Hopefully, this report will serve as a wake-up call on the importance of sustaining our existing nuclear energy plants – failure to do so would harm Americans’ pocketbooks as well as our ability to generate reliable, carbon-free electricity.”
“Unfortunately, current market conditions are leading America towards a path where having a less diverse power supply is a very real possibility,” said former U.S. Senator Judd Gregg, co-chair of Nuclear Matters. “This study demonstrates that the loss of a diverse energy mix that includes existing nuclear plants will have serious economic consequences for our nation. We cannot afford the effects that such a loss will have on our economy, in terms of lost GDP and job losses.”
Nuclear Matters is a bipartisan education campaign that strives to raise awareness among consumers and policymakers of the need to properly value and preserve America’s existing nuclear energy plants for the many benefits they provide.
Supporters of Nuclear Matters include a range of companies and organizations, including Ameren Missouri, American Nuclear Insurers, Arizona Public Service, AREVA, Black & Veatch, Burns and Roe Enterprises, Dominion, Duke Energy, Energy Future Holdings, Energy Northwest, Exelon, FirstEnergy and Hitachi GE Nuclear Energy.