September 14, 2015 09:00 AM Eastern Daylight Time
WASHINGTON–(BUSINESS WIRE)–Pennsylvania’s five nuclear energy plants contribute approximately $2.36 billion to the state’s gross domestic product (GDP), in addition to other economic and societal benefits, according to a new study conducted by economists at global consulting firm The Brattle Group.
The report estimates Pennsylvania’s nuclear power plants’ contribution to the Pennsylvania economy and to limiting greenhouse gas emissions. The research concludes that Pennsylvania’s nuclear industry accounts for 15,600 in-state full time jobs (direct and secondary) and provides $81 million in net state tax revenues annually. Average annual carbon dioxide emissions would be about 52 million tons greater absent the generation from Pennsylvania’s nuclear plants. This is worth an additional $2.24 billion annually if valued at the U.S. government’s estimate for the social cost of carbon.
“The economic and environmental benefits of nuclear energy are often undervalued in national and state energy policy discussions,” said Dr. Mark Berkman, co-author of the report and a principal at The Brattle Group. “It is even more critical to consider the significant value of U.S. nuclear plants in a landscape where several factors threaten some nuclear facilities and could diminish the industry’s contribution to our electricity supply, the economy, and the environment.”
“This report stresses the need to address the underlying challenges associated with premature nuclear energy plant shutdowns to ensure that Americans can continue to reap the indisputable benefits that these plants bring to the table,” said Nuclear Matters co-chair, former Senator Judd Gregg (R-NH). “The public and policymakers are seldom offered such starkly obvious public policy choices as working to ensure existing nuclear energy plants continue to operate.”
“Reducing carbon emissions is one of our country’s top priorities, especially in light of the Environmental Protection Agency’s recently finalized Clean Power Plan,” stated Nuclear Matters co-chair, former Senator Evan Bayh (D-IN). “And yet, in this carbon-constrained world, existing nuclear energy plants receive no value for their ability to generate an astounding amount of carbon-free, reliable energy. The answer to one of our biggest environmental and economic challenges lies, in part, in nuclear energy. Without nuclear power, it would be impossible to achieve our carbon reduction objectives.”
Nuclear energy in Pennsylvania also helps keep electricity prices low, keeping wholesale prices down across all of PJM, including Pennsylvania. This is the primary means by which nuclear power boosts Pennsylvania’s economy. In fact, Pennsylvania consumers would spend almost $600 million per year more on electricity absent nuclear plants in the state. Between 2015 and 2024, this increase totals over $5 billion on a present value basis. Throughout all the PJM states, that would translate to an annual increase of over $2.6 billion for consumers, which would total more than $22 billion from 2015 to 2024.
“As the birthplace of commercial nuclear power, Pennsylvania has a long history of benefitting from this important technology,” said Pennsylvania 47th District Senator Elder Vogel Jr. (R-Rochester). “In addition to calling itself home to nine operating nuclear generating reactors, the state is fortunate to host some of the leading, innovative businesses and higher education engineering programs that serve the nuclear industry. We must continue to include nuclear energy as a valuable part of Pennsylvania’s energy mix as we look for ways to enhance our state’s future prosperity.”
Nuclear energy provides almost 20% of the United States’ electricity. However, some nuclear plants are at risk of being prematurely shut down due to a confluence of economic and policy challenges.
The report estimates Pennsylvania nuclear plants’ economic value using Regional Economic Models, Inc. (REMI), a widely-used dynamic input-output model of the U.S. economy, linked with a simplified Brattle model of the U.S. electricity sector to better capture the dynamics of power markets and prices. By linking these models, the authors were able to measure the economic output, employment, and tax revenue in Pennsylvania with and without its nuclear plants, providing the most accurate picture of their contribution to the economy.
“Pennsylvania Nuclear Power Plants’ Contribution to the State Economy” was prepared for Nuclear Matters by The Brattle Group.
A national report that estimates the value of the entire nuclear industry to the U.S. economy, “The Nuclear Industry’s Contribution to the U.S. Economy,” was released on July 7th. The national report concludes that the United States’ nuclear energy plants contribute $60 billion annually to national GDP, among other findings.
About Nuclear Matters
The mission of Nuclear Matters is to inform the public about the clear benefits that nuclear energy provides to our nation, to raise awareness of the economic challenges to nuclear energy that threaten those benefits, and to work with stakeholders to explore possible policy solutions that properly value nuclear energy as a reliable, affordable and carbon-free electricity resource that is essential to America’s energy future.
Supporters of Nuclear Matters include a range of companies and organizations in the energy industry, including Ameren Missouri, American Nuclear Insurers, Arizona Public Service Company, AREVA, Black & Veatch, POWER Engineers, Centrus Energy Corp. Dominion, Duke Energy, Energy Future Holdings Corporation, Energy Northwest, Entergy Corporation, Exelon Corporation, FirstEnergy Corp., GE Hitachi Nuclear Energy, Lightbridge Corporation, Nebraska Public Power District, NextEra Energy Inc., Omaha Public Power District, Pacific Gas and Electric Company, South Texas Project Nuclear Operating Company, Southern Company, Tennessee Valley Authority, and Westinghouse Electric Corporation.
About The Brattle Group
The Brattle Group analyzes complex economic, finance, and regulatory questions for corporations, law firms, and governments around the world. We are distinguished by the clarity of our insights and the credibility of our experts, which include leading international academics and industry specialists. For more information, please visit www.brattle.com.