BETA
This is a BETA experience. You may opt-out by clicking here

More From Forbes

Edit Story

Obama's Carbon Order Increases Nuclear Energy's Odds

Following
This article is more than 9 years old.

Mandating the reduction of carbon emissions could result in the increasing use of nuclear energy. Is that good?

If the nation’s current and former leaders of the Environmental Protection Agency are asked, the answer is an unmistakable ‘yes.” In fact, once nuclear plants become operational, they are able to generate electricity efficiently, safely and cheaply. Now that the White House is making it more costly for utilities to emit carbon dioxide, nuclear energy could become an attractive option.

That’s why Gina McCarthy, Carol Browner and Christine Todd Whitman are stumping for nuclear power as a sure-fired way to keep a lid on current carbon emissions, and potentially as a method to make notable cuts in such releases.

To that end, EPA Administrator McCarthy was in Chicago last week where she was pitching the Obama administration’s plan to reduce carbon dioxide emissions by 30 percent by 2030. The states will have flexibility and will submit their action plans by 2016, which they can achieve by having their utilities change-out their coal-fired plants, by installing energy efficient technologies or by trading carbon credits as they do in the Northeast and in California.

But the administrator wanted to underscore that the economic pressures now facing many smaller nuclear plants are immense, largely because they are unable to compete with cheap natural gas: The abundance of shale gas has resulted in sustained low natural gas and wholesale energy prices, making it difficult for the “merchant” power plants that sell their power at market prices to compete.

Some nuclear plants that are scheduled to be re-licensed may opt out, says McCarthy. Exelon Corp., the country’s largest generator of nuclear energy, says that it could close some of its facilities if the playing field is not leveled -- or, if certain fuels continue to get government subsidies at nuclear’s expense.

Already, five nuclear units have either shut down or have announced that they will do so: Duke Energy and Southern California Edison closed their Florida and Southern California facilities, respectively, because of persistent technical issues. Meanwhile, Dominion Resources has closed its Wisconsin unit, Exelon will shut down a New Jersey plant and Entergy will cease its Vermont Yankee, all because they are unable compete with natural gas.

“It's a lot of carbon reduction that needs to be made up for a long period of time,” McCarthy says, as quoted by the Chicago Tribune.

Meantime, two other former EPA administrators are making the same arguments to mixed audiences: Browner, who served under President Clinton and Whitman, who served under President George W. Bush.

Browner, who also served as the director of the Office of Energy and Climate Change Policy under President Obama, is now a member of the Leadership Council of Nuclear Matters that is funded by Exelon. In a column she penned for Forbes, she explains that -- like other folks in the environmental movement -- she has evolved: She is now pro-nuclear, seeing at a valid way to produce carbon-free electricity on a massive level.

Electricity generation accounts for 40 percent of this country’s carbon emissions, she says, much of which is the result of burning coal. By contrast, nuclear energy now makes up 19 percent of the nation’s electricity portfolio, she adds, contributing almost no carbon pollution in the process.

As the coal portfolio here wanes, the main choices are hydro, wind and solar as well as nuclear and natural gas fuels. By all accounts, natural gas is the path of least resistance because it is abundant and presently just as cheap as coal, while it is also relatively less problematic to get those plants permitted and built than it is a nuclear unit. Excluding hydro, wind and solar, by contrast, are gaining traction but remain in the single digits in terms of electricity generation market share.

Despite the setbacks, U.S.-centered nuclear energy development is making some headway: Southern Company, Scana Corp. and the Tennessee Valley Authority are actively developing nuclear energy.

Southern Co. and its partners are building two new units where two other other nuclear reactors now reside. The total price tag is estimated at $14 billion. Of that, the partnership has gotten $8 billion loan guarantee while it puts up $6 billion of its money. Southern expects its first unit to be operational by 2018 and Scana is on a similar timetable.

The federally-owned TVA, meanwhile, is committed to building a new $4 billion nuclear reactor at its “Bellefonte” site. The 1,260 megawatt facility is also expected to be generating power by the end of the decade. It is replacing older coal-fired units — a move that the board there says will reduce operational costs and offset the initial investment.

The Bellefonte site in Alabama actually got its start in 1974. But construction stopped because demand had fallen. By 2009, federal regulators had agreed to allow the completion of two reactors on that site, although TVA says that it will only build one of them. That unit must still get a final Okay.

“In addition to fields like renewables, we have one industry already that is producing a lot of jobs and can produce a lot more – and that's the nuclear energy industry,” says Whitman, who is also a former governor of New Jersey. “Nuclear energy is the only base load power that releases no greenhouse gases or other regulated pollutants when producing power.”

The Obama administration’s executive order certainly gives nuclear energy the leg up it needs in a carbon constrained world. And while three high-profile environmental advocates are trying to increase the fuel’s odds, it still has opponents who want to pull the rug out from underneath it.