More nuclear plant retirements could contribute to carbon dioxide (CO2) emission increases from the electric power sector, economists from the Brattle Group said in a white paper issued Dec. 19.
In 2015, nuclear energy provided 20% of all U.S. net generation; this is nearly 60% of the carbon-free electricity generated in the United States, considerably more power than is provided by solar, wind, and hydroelectricity combined, Brattle authors said in the whitepaper.
Three nuclear units, the Dominion (NYSE:D) Kewaunee in Wisconsin, Entergy (NYSE:ETR) Vermont Yankee in Vermont, and the Omaha Public Power District (OPPD) Fort Calhoun in Nebraska have recently retired. Three more units—Entergy’s Pilgrim in Massachusetts, the Exelon (NYSE:EXC) Oyster Creek facility in New Jersey, and Entergy Palisades in Michigan, representing over 2 GW of capacity—have announced that they will retire over the next few years, all due, at least in part, to poor operating economics.
According to the Brattle analysis, the retirement of a 1,000 MW nuclear plant could increase CO2 emissions in the range of 4.1 to 6.7 million tons per year, or 0.52-0.84 tons per megawatt hour (MWh) of nuclear generation lost, depending on the region in which the nuclear retirement occurs.
Look for the study to be cited by nuclear supporters to bolster the case for pro-nuclear policies such as the ones that are being enacted in the states of New York and Illinois.
The Brattle analysis also finds that preventing premature nuclear retirements is a cost-effective means of restraining carbon emissions to attain climate policy goals. A typical revenue deficit for a vulnerable nuclear plant is around $10/MWh.
If this shortfall were offset by a carbon uplift payment, the cost of the avoided CO2 emissions would range between $12 and $20 per ton of CO2, varying with the regional fossil fuel mix that would substitute for the plant, Brattle said in the white paper.
The whitepaper, “Nuclear Retirement Effects on CO2 Emissions: Preserving a Critical Resource,” is authored by Brattle Principals Metin Celebi, Marc Chupka, Frank Graves, and Dean Murphy, and Research Analyst Ioanna Karkatsouli, with funding and support from the Nuclear Energy Institute (NEI).
The Brattle whitepaper examines the aggregate and regional carbon emission impacts of premature nuclear retirements, and evaluates the implications of such retirements for the ability to achieve carbon reductions in the U.S. power sector. Based on their analysis, the authors find that:
•Under current market conditions, some nuclear units do not reliably earn sufficient revenue to cover going-forward costs, and thus are vulnerable to premature economic retirement under current market conditions. The revenue shortfalls experienced by the most vulnerable plants – typically small, single-unit plants operating in markets with particularly low energy prices – can be as high as about $20/MWh, though most experience smaller shortfalls.
•The increased level of CO2 emissions arising from a premature nuclear retirement is not confined to the state in which the unit resides. Rather, the majority of this emissions increase is likely to occur outside the state, with a substantial share from beyond even the adjacent states. This geographic dispersion of emission effects throughout regional electricity markets may pose challenges to state-level climate policies and goals.
•Since CO2 emissions persist for many years in the atmosphere, near-term emission reductions are more helpful for climate protection than later ones. Thus, preserving existing nuclear plants will improve the effectiveness of any climate policy approach, by holding down cumulative emissions.