Thursday, November 29, 2018

Nuclear Energy Caucus Releases Report On The Impact Of Closing Nuclear Power Plants, Possible Solutions

On November 29, Senators Ryan Aument (R-Lancaster) and John Yudichak (D-Luzerne) along with Representatives Becky Corbin (R-Chester) and Rob Matzie (D-Allegheny), co-chairs of the Senate-House Nuclear Energy Caucus released a report summarizing their findings on the impact of closing nuclear power plants in Pennsylvania and outlining potential solutions.
[Click Here to watch the announcement live at 11:00, according to the Caucus.]
The report, which will be transmitted to all members of the General Assembly and to Gov. Wolf, includes four options for the future of the state’s challenged industry, including the General Assembly taking action in 2019 to prevent the "employment, economic, and environmental devastation" associated with the premature closure of nuclear plants in the Commonwealth.
Acknowledging the announced premature closures of Three Mile Island in 2019 and Beaver Valley in 2021, one-fourth of Pennsylvania’s nuclear power, Sen. Aument said: “As state lawmakers, we take seriously our obligations to set energy policies that help promote Pennsylvania’s economy and protect our environment. The loss of these plants would be a devastating and permanent blow to Pennsylvania’s communities, economy, and environment so we took a hard look at what could and should be done to prevent this, and future, devastation.”
Since its formation in March 2017, the Nuclear Energy Caucus-- the first of its kind anywhere in the nation-- has tried to better understand the underlying causes of nuclear plant premature retirements, and to determine if these announced closures were an anomaly or a symptom of a larger problem for Pennsylvania’s nuclear industry.
Benefits
After hosting educational meetings throughout the 2017-2018 Legislative Session to hear expert testimony on topics ranging from clean energy to national security, the Nuclear Energy Caucus found that Pennsylvania’s five nuclear plants provide numerous benefits, including:
-- Providing nearly 40 percent of the Commonwealth’s total electricity production and just over 93 percent of Pennsylvania’s zero-emissions energy
-- Supporting 16,000 jobs in Pennsylvania and contributing more than $2 billion annually to the Commonwealth’s economy
-- Moderating electricity prices, benefitting Pennsylvania customers by an estimated $788 million per year in the form of lower bills
-- Improving air quality by preventing substantial emissions of C02, S02, and particulate matter
-- Ensuring grid resilience and reliability by providing energy to the grid 24/7
“Promoting and preserving the numerous, important benefits provided to our citizens by the state’s nuclear industry is precisely the reason the Nuclear Energy Caucus was created,” said Representative Matzie.
The Caucus also sought to understand the employment, economic, and environmental impacts associated with the premature closures and determine if there are any actions the General Assembly or the Commonwealth should be undertaking to prevent the premature closure of the state’s nuclear plants.
Understanding the continued inaction by Congress, the Federal Energy Regulatory Committee, and regional grid operators such as PJM, states like New York, Illinois, Connecticut, and New Jersey took direct action to prevent the devastating economic, environmental, and consumer impacts associated with losing their state’s nuclear industry.
Options
According to the report, the current federal, regional, and state landscape leaves Pennsylvania with four options to determine the future of Pennsylvania’s nuclear industry--
-- Do nothing and leave Pennsylvania’s clean energy resources, including its nuclear plants, on a trajectory to early retirement – effectively allowing PJM to dictate the mix of resources serving Pennsylvania.
-- Modify AEPS (or establish a ZEC program) to put nuclear generation on equal footing with other zero-emission electric generation resources in Pennsylvania.
-- Modify AEPS (or establish a ZEC program) with a “safety valve” mechanism that (depending on the outcome of the FERC proceeding) would allow Pennsylvania to adopt a new capacity construct proposed by FERC that is designed to accommodate state programs to support preferred generation resources.
-- Establish a Pennsylvania carbon pricing program.
“It’s clear to me that only some of the report’s options are viable for preventing irreversible harm to Pennsylvania’s communities, economy, and environment associated with losing nuclear power plants. Pennsylvania lawmakers will have to act soon if we want to protect our consumers and the nuclear industry because policymakers and regulators in Washington D.C. have failed to address growing, long-standing flaws in energy markets,” said Rep.  Corbin.
“Given our state’s prominence in energy production, it is important that lawmakers focus on an inclusive energy policy that promotes and respects the contribution that each resource offers. The NEC looks forward to continuing the dialogue with our colleagues in the General Assembly in the coming weeks and months,” said Sen.Yudichak. “But time is not on our side. Pennsylvanians – especially those whose livelihood depends on nuclear energy – are looking to us for action.”
Click Here for a copy of the report.
For more information and videos from past hearings, visit the Senate-House Nuclear Energy Caucus webpage.
Reaction
The Environmental Defense Fund said this about the Caucus report--  “It’s clear that Pennsylvania can, and must, set a declining limit on carbon emissions to protect families and communities across the state from the growing threat of climate change” said Andrew Williams, Director of Regulatory and Legislative Affairs for Environmental Defense Fund. “The federal government’s leadership on climate may be stalled for the moment, but other states are leading the way. Pennsylvania can – and should – step up and create a system with flexible, market-based solutions that will reduce climate pollution.”
Pennsylvania is the only state in the Northeast without a hard limit on carbon pollution from the power sector – or any plan to put one in place. Such a policy would drive cost-effective investment in zero-emission resources, and ensure that the Commonwealth is achieving necessary pollution reductions at the lowest cost.
The Trump administration has said it will withdraw the U.S. from the Paris climate accord, But Pennsylvania and other states can still work to meet the accord’s greenhouse gas emissions reduction goals of up to 28 percent below the 2005 level by 2025.
The Natural Resources Defense Council issued this statement on the report--  The nuclear caucus’s report lays out four policy options “to preserve the Commonwealth’s clean energy resources,” a phrase used to mean both Pennsylvania’s nuclear plants and the various “alternative” energy sources currently supported by the Alternative Energy Portfolio Standards Act (AEPS).
Preservation of the AEPS resources is invoked because an ongoing proceeding at the Federal Energy Regulatory Commission (FERC) is likely to prevent AEPS-supported resources from earning money in PJM’s capacity market, a reliability mechanism that pays plants for their commitment to be available in the future.
As a result, whatever action Pennsylvania takes concerning the state’s nuclear plants, it will likely have to change its laws to ensure that AEPS resources are fairly compensated for the capacity they provide.
These ideas are an important starting point for discussing a clean energy transition in Pennsylvania, but they fall short of the broad range of policies the Commonwealth really needs to address climate change.
There is no discussion of how much energy Pennsylvania could save by ramping up efficiency.
And in response to the idea that nuclear power should be replaced by renewables, the report answers simply that “replacing the lost output from nuclear retirements with renewables would take years at current development rates.”
But the relatively slow rates of development now are exactly why the Commonwealth needs policies to spur efficiency, wind and solar. The caucus’s report does not appear to propose anything that would do that.
This is a serious shortcoming and a missed opportunity. As our nuclear transition issue brief makes clear, any legislation based on these recommendations must do better.
Click Here for a copy of NRDC’s nuclear power transition brief.
Citizens Against Nuclear Bailouts-- a diverse coalition of Pennsylvania citizens’ groups, power generators, and energy, business and manufacturing associations-- has issued the following statement in response to the Nuclear Energy Caucus report--
Today, the Nuclear Energy Caucus released its report based on testimony delivered primarily by the nuclear industry itself. While we appreciate that the Nuclear Energy Caucus was formed to better understand Pennsylvania’s competitive energy markets, this report takes a singular view of a complex issue without input from consumer groups, state and federal regulators, independent power generators and, most important, ratepayers, who are benefiting from the state’s deregulated electricity markets.
Pennsylvanians are prospering more than ever thanks to a deregulated market, a diverse energy portfolio that includes nuclear energy, the growth of energy-efficiency technology, and a rise in cleaner natural gas and renewable power generation. The benefits of a competitive market will continue with no disruption to service. PJM Interconnection, a regional transmission organization, has publicly testified at a Nuclear Energy Caucus hearing that there is no concern over grid resiliency or reliability — a statement at odds with the picture the nuclear industry has attempted to create in an effort to secure a bailout.
Our coalition values all sources of power generation; however, regulators at all levels have confirmed that the markets are working and that the electricity grid will remain reliable and resilient, calling into question the need for any policy change that would destroy the state’s competitive electricity marketplace.
The nuclear industry will argue that Pennsylvania can’t afford to do nothing. The fact is that competition, innovation, energy efficiency and sustainability are driving an electricity grid that is more diverse than ever and an environment that is improving every day.
Citizens Against Nuclear Bailouts will continue to ask the state Legislature to heed the call of our members and ratepayers in Pennsylvania who have overwhelmingly said they refuse to pay more to prop up nuclear corporations that are failing to compete.
[NOTE: Reactions will be added as they become available.]
(Photo: Three Mile Island nuclear power plant, Dauphin County.)
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