Unable To Compete On Price, Nuclear Power On The Decline In The U.S.
Renewable energy and new technologies that are making low-carbon power more reliable are growing rapidly in the U.S. Renewables are so cheap in some parts of the country that they’re undercutting the price of older sources of electricity such as nuclear power.
The impact has been significant on the nuclear industry, and a growing number of unprofitable reactors are shutting down.
When the first nuclear power plants went online 60 years ago, nuclear energy seemed like the next big thing.
In many ways, it lived up to that promise. It turned out to be remarkably safe and reliable and clean. It’s carbon-free and is the source of about 20 percent of the country’s electricity.
But right from the start, people in the nuclear industry struggled with a big problem: cost. Making nuclear power cheap was the Holy Grail.
It never panned out. Nuclear plants keep coming in over-budget. And after the Fukushima disaster in Japan in 2011 — when three nuclear reactors melted down after an earthquake and tsunami hit — companies were forced to spend millions of dollars more on safety equipment to keep older plants operating.
“It would be very difficult for any company to make a decision to try to build a new nuclear plant,” says Mike Twomey, a spokesman for Entergy Nuclear, which runs nuclear power plants.
Entergy has already taken one unprofitable reactor offline in Vermont and plans to close two more plants that are losing money in upstate New York and Massachusetts.
In all, 19 nuclear reactors are undergoing decommissioning, of which five have been shut down in the past decade, according to the U.S. Nuclear Regulatory Commission.
The main reason behind the wave of closures is a new generation of cheap, gas-fired power plants that has pushed the wholesale price of electricity into the basement.
But Mycle Schneider, a nuclear industry analyst, says nuclear also faces growing price pressure from wind and solar. Renewable energy is so cheap in some parts of the U.S. that it’s even undercutting coal and natural gas.
“We are seeing really a radical shift in the competitive markets which leave nuclear power pretty much out in the rain,” Schneider says.