U.S. nuclear operators try to save plants with carbon emission rule

by Reuters
Friday, 31 July 2015 18:24 GMT

By Valerie Volcovici

WASHINGTON, July 31 (Reuters) - The U.S. nuclear industry has made a last-minute push to urge the Obama administration to protect the country's 100 nuclear units in its forthcoming carbon rule and prevent the early retirement of several plants.

Representatives of the Nuclear Energy Institute met on July 21 with White House officials who are currently reviewing the final version of the Environmental Protection Agency's Clean Power Plan. The industry contends the original version of the plan, released in mid-2014, fails to encourage states to keep some "at risk" plants from closing.

NEI and other industry officials said the final plan, which is expected as soon as Monday, should provide incentives for states to renew operating licenses and ramp up generation at nuclear plants.

The industry said eight plants - producing about 8,000 MW of generation - struggle to compete in competitive electricity markets. The lobby group argued that the loss of even one of these zero-carbon emission plants would be "a major blow to carbon reduction efforts."

The details were posted on the White House Office of Management and Budget website.

The Clean Power Plan is the centerpiece of President Barack Obama's climate change strategy, which seeks to slash power plant carbon emissions to 30 percent below 2005 levels by 2030.

Nuclear energy plays a crucial role in this plan, its advocates say, accounting for 20 percent of the U.S. energy mix and roughly two-thirds of zero-emission generation.

Some nuclear plants struggle to compete against cheaper natural gas-fired plants in states such as Illinois and New York.

Although natural gas generation is less carbon-intensive than coal-fired electricity, it emits more emissions than nuclear power.

Four reactors have shut down since 2013; two of those related to poor market conditions for nuclear power.

"This rule is critical to the continued viability of the existing U.S. fleet," Kathleen Barrón, senior vice president for regulatory affairs for Exelon, which owns or operates 24 of the country's 100 nuclear reactors, said in an interview.

Barrón said the EPA had tried to create an incentive for states to keep nuclear generation in the draft rule, but it was poorly conceived.

She said in some states, 30 per cent of their nuclear generation is "at risk" of being retired early, more than the 6 percent the EPA and Energy Department estimated.

Without incentives to keep nuclear plants online, states could replace some of that energy with higher-emission sources like natural gas, said Sue Tierney, an advisor to the Analysis Group and former Department of Energy official. (Reporting By Valerie Volcovici; Editing by Andrew Hay)

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