Natural Gas Industry Blasts Nuclear Power With Fake News
Natural Gas, the darling energy source of the millennia, has decided it needs to take down its biggest competitor – nuclear power.
The American Petroleum Institute has flooded the airwaves in Ohio and Pennsylvania with anti-nuke commercials and has even drawn AARP into the fray by pushing fear – fear of higher prices and fear of radiation. Just the opposite of what is true.
This is ironic since the natural gas industry emits more radioactivity than all of nuclear in America combined. And more people die every year from natural gas than any other electricity source except coal.
The Issue
The issue in these states is that warped wholesale electricity markets, renewable subsidies and cheap natural gas from hydraulic fracturing (fracing) have made low-cost nuclear power just not low enough for short-term profitability, putting some nuclear plants at risk of closing. Several have already closed and six more are scheduled to close in the next ten years.
Most climate scientists, like Jim Hansen, and economists say that a small subsidy, much smaller than renewables get, is necessary to keep these plants open and preserve both the low-carbon power and the generation diversity needed to weather changes in the market and in the climate. During the last Polar Vortex, nuclear was the only source unaffected by the extreme cold. And nuclear costs are stable and predictable for decades, unlike natural gas or renewables.
The trend has power regulators worried, with those in New York and Illinois recently approving subsidies to keep their nuclear fleets operating, saving thousands of high-paying jobs and most of the states’ clean energy. The regulators and utility operators know how important energy diversity and baseload power are to the stability of the electric grid. This is an esoteric concept that most people do not understand, yet it rules their daily energy lives.
A new article for Scientific American points to the overwhelming evidence that saving nuclear plants is the most environmentally significant and cost-effective thing that governors can do for their states.
API does not want any help to go to nuclear, which it sees as a competitor, and a hurdle to their plan for natural gas rising to 80% of electricity generation in these markets. They want to capture this monopoly quickly before natural gas prices rise after America links to the global market in the next several years.
The gas industry is frantically building liquefied natural gas (LNG) facilities and coastal terminals in order to enter the global market, which should increase natural gas prices in the United States by between 50% and 100%. They want to stop nuclear since the lead times for nuclear builds or even relicensing are so long, that the nuclear industry may not be able recover after gas prices increase, and consumers will be stuck with higher electricity prices for decades.
Gas is perfectly positioned for this takeover since the wholesale markets in these states were changed in the last twenty years such that natural gas became the most desirable source after 2007.
The natural gas industry actually admitted in court (personal communications from the PA State Legislature) that helping nuclear will rob the gas industry of $600 million in profits per year that would come from consumers. Keeping nuclear open would only cost $200 million per year, a clear benefit to the citizens of Pennsylvania and Ohio.
API is calling this legislative help for nuclear a ‘nuclear bailout’ – which it is not.
These plans do not involve subsidies. Nuclear plants get paid by electric customers at a cost-based rate approved by state public commissions. There is no taxpayer funding. The plan effectively makes them public utilities.
The Details
Electric customers pay a rate that blends the costs from all generation sources, which is the way it was before deregulation and the emergence of non-utility generators, mostly natural gas. For decades, natural gas generation was by far the highest price generation source but consumers never paid its high costs because they were blended with low cost nuclear. That was not a subsidy for gas generation and these new plans to preserve nuclear are not a subsidy or a bailout either.
Unfortunately, the gas industry’s strategy of misinformation seems to be working. Efforts by the utility First Energy to get Ohio legislators to create new regulations enacting zero emission credits (ZECs) for the Davis-Besse and Perry nuclear power plants have stalled out according to news media reports.
Exelon Vice President Joseph Dominguez said in testimony to the Ohio Senate’s Public Utilities Committee on June 1 that six nuclear reactors in five states have shut down and another seven nuclear reactors will shut down prematurely by 2019. This is a result of electricity markets not properly valuing the benefits of baseload electricity.
Nuclear power produces over 68% of America’s low-carbon power. Non-hydro renewables produce less than 10%. If these nuclear power plants are lost, it will wipe out more low-carbon generation than all the power produced by wind, solar and geothermal in America.
Another reason that legislators are gun shy about calling for a vote on this issue is the intensity of the opposition. In addition to industry, consumer groups and interest groups, like the American Association of Retired Persons (AARP), mobilized to stop the proposal. Funded by API and the Oil&Gas industry, AARP’s efforts called ZECs a ‘subsidy designed to prop up a failed business model.’
