Tuesday, May 26, 2015

EPA’s Clean Power Plan Needs Nuclear Energy On The Menu

Matt Wald
The following is a guest post from Matt Wald, senior director of policy analysis and strategic planning at NEI.

It’s so obvious that it shouldn’t bear repeating, but it does: If you’re worried about climate change, one early, easy remedy is to preserve nuclear power plants that are already running. If you are facing limits on carbon emissions, don’t shut down perfectly serviceable merchant nuclear plants, just because cheap natural gas has left them, for now, a few bucks out of the money in the competitive electricity markets.

Last Thursday the National Association of Clean Air Agencies, a group made up of officials from 42 states and the District of Columbia, plus 116 metropolitan areas, released its 465-page “Menu of Options” for complying with the Environmental Protection Agency’s Clean Power Plan (Section 111 (d) of the Clean Air Act).

We could quibble with some details, like describing nuclear technology as “mature.” It is highly developed, but it has evolved markedly in the last 20 years, and that will continue. Don’t discount the idea of new designs and fresh reactor concepts that will change the energy world in the 2020s or 2030s.

We could also argue with the report’s characterization of nuclear power as not renewable; when circumstances favor it, the world will build plants that make more fuel than they consume, and can go back to pull energy resources out of spent fuel.

But the menu makes two very clear points. First, drawing on a finding of the EPA, it concludes, “preserving the availability of existing units that might otherwise be retired is a cost-effective way to reduce GHG emissions.” (In fact, taking a reactor out of the mix now is a bit like trying to pilot a ship through a storm, deciding that it will be necessary to bail, and instead of pumping water out of the bilge, pumping it in.)
Nuclear energy. Down in the weeds, but in a sweet spot.
And second, “zero emissions” are never precisely zero, but they get pretty close. The study lists a cradle-to-grave, “lifecycle” estimate of emissions, including construction, fabrication, fuel processing, etc, for twelve technologies, based in hundreds of separate studies. The handbook gives an upper and lower bound. Nuclear is, to use the technical term, down in the weeds, lower than biopower and photovoltaics, in the ballpark with geothermal, and a smidgen above wind. Combined cycle natural gas, which rules the market for the time being – as long as carbon emissions are completely free, and emissions of other air pollutants are not counted in dollar terms – are about ten times higher; coal, depending on the technology, is twelve to fifteen times higher.

The handbook also compares “levelized costs,” (see below) that is, costs that take into account fuel, construction expense, and the lifetime of the asset. These, too, are expressed in a range. For the central estimate, new nuclear is, in fact, pricey, but not nearly as expensive as the two forms of solar – photovoltaic cells, or thermal systems, which use the sun’s heat to boil water.
Priced more competitively than you might think.
Energy from wind can be slightly cheaper, but you don’t get to pick when the wind blows.

Friday, May 22, 2015

Google and Facebook’s Nuclear-driven Data Centers

A Greenpeace initiative that’s actually kind of interesting is its drive to get large scale data centers – such as those run by Google, Facebook and Apple – to use more renewable energy to run them. They call it Clicking Clean.

Greenpeace operates in an area where the practical -  which, after all, is what electricity is – intersects with the idealistic, if one defines idealism fairly narrowly, i.e., as what Greenpeace favors.

That’s where data centers come in. There’s a cluster of them in North Carolina, which, in part, has to do with the state’s efforts to foster high-tech development. I’ve had a couple of friends migrate to the Research Triangle (Raleigh-Durham) to pursue their careers, so it’s having an impact on the east coast at least. But it likely also has something to do with plentiful electricity

But here’s the problem for Greenpeace.

Greenpeace says Duke’s Green Source Rider, proposed in 2013 at the urging of Google and Facebook as a way to sell green energy to customers willing to pay the additional cost, once seemed like a breakthrough.

However, the authors argue, “the design and price structure ... imposed by Duke have been such a barrier that thus far no companies have agreed to purchase renewable energy under the program.”

Duke intends to increase its renewable energy output to 4 percent from 2 percent in the next few years.

And that brings us to this:

He accuses Greenpeace of cherry-picking its statistics. He says the report emphasizes that Duke has just 2 percent of renewable energy in its system now and plans to have just 4 percent by 2029. But Wheeless says the report ignores Duke’s sizable hydro power capacity and the power produced by zero-carbon nuclear plants.

The “he” there is Duke spokesman Randy Wheeless. Nuclear and hydro together make up about 37 percent of electricity production in the state (nuclear alone is 32 percent), about the same as coal.

Greenpeace is not so much cherry-picking as paying attention to what interests them – and that’s not nuclear energy. The extent to which Facebook, Google, Duke or North Carolina care about this is up to them. But as far as we’re concerned, Google and Facebook made intelligent choices in putting some of their data centers in North Carolina (and Virginia, too, for that matter ) – where a lot of the baseload energy is not only clean but plentiful enough to manage my searches or see what my crazy uncle is up to. If I were in North Carolina, I’d consider my clicks plenty clean as is.

Thursday, May 21, 2015

What Matters to Jeb Bush, Yucca Mountain and Media Matters

casaenergyIT’s way too early in the cycle to talk about the presidential candidates’ energy policy formulations – heck, we may not have the majority of them announced as candidates yet. Consider, then, former Florida Governor Jeb Bush, one of those candidates who has not yet announced.

The Associated Press and Las Vegas Review-Journal reported that GOP presidential hopeful Jeb Bush spoke out against the proposal to bury nuclear waste in Nevada's Yucca Mountain, without mentioning Bush's ties to a nuclear industry group that actively supports the project.

Really, a nuclear energy group? Which one?

What the AP and Review-Journal left out, however, is that Bush is currently listed as a member of a nuclear industry group called the Clean and Safe Energy Coalition (CASEnergy), which has long advocated for Yucca Mountain -- and continues to do so. As recently as February 24, CASEnergy published a blog post declaring Yucca Mountain a "scientifically safe and sound option" for storing nuclear waste permanently, and "a critical component" of the nation's shift to nuclear energy.

Well, CASEnergy didn’t declare that – the NRC did and CASEnergy is reporting it (approvingly, but still.) 

To be fair, Media Matters is right that CASEnergy supports Yucca Mountain:

The key elements of a U.S. used fuel management policy include flexible interim storage approaches, the licensing and construction of an underground repository at Yucca Mountain, and facilities for recycling used nuclear fuel to take advantage of the maximum energy from the fuel in a manner that includes effective safeguards against nuclear proliferation.

But here’s the thing: CASEnergy has no loyalty oath asking its members to support nuclear energy in all of – or even any of - the specific issues the group advocates. To be fair, Media Matters is not characterizing CASEnergy as having a politically ideological mission – but it is suggesting that it wants a certain purity from its members. Which it doesn’t – at all.

In this regard, a comment from CASEnergy Co-Chair Christine Todd Whitman at the Nuclear Energy Assembly struck me:

I would like a national energy policy that says we want clean, green, reliable, affordable energy and leave it at that. And let the marketplace figure out the best ways to meet those goals.

Now, obviously, Whitman advocates for nuclear energy – read her comments in the post below this one – but that doesn’t sound like a person with a purity test, does it?

So if Gov. Bush does not support Yucca Mountain, fine. He’s still a member of CASEnergy in good standing.

---

One further niggle with the Media Matters report:

Nevada political reporter Jon Ralston first detailed Bush's ties to the pro-Yucca industry group in March, in a blog post in which he wrote that Bush "was once part of a front group for the Nuclear Energy Institute, the main lobbying entity behind siting a repository at Yucca Mountain."

Front group?  NEI created CASEnergy to provide a vehicle for individuals to advocate for nuclear energy – NEI itself is geared toward corporate membership. You could say Media Matters stumbled into a mire with this one. Gov. Bush says he doesn’t support Yucca Mountain and CASEnergy has no brief on anything Gov. Bush says or does regarding nuclear energy. But Media Matters thinks it ought to.

Why? What does that say about Media Matters?

Wednesday, May 20, 2015

The QER, Nuclear Energy and Energy Infrastructure

Matt Wald
The following is a guest post from Matt Wald, senior director of policy analysis and strategic planning at NEI.

The Energy Department has posted the first installment of its Quadrennial Energy Review. Quite sensibly, the department cast a critical eye on the sorry state of energy infrastructure: overstressed gas lines that leak, sometimes catastrophically, and can’t meet the demand during cold spells; bottlenecks in the rail and canal systems that move coal and oil; and electric generating stations that starve for fuel when the coal pile freezes.

But the sections of the plan that have been published so far do not give any credit to generation technologies that do not add strain to the fuel shipment infrastructure. To the department’s credit, officials there say that they are working to “unbundle” the attributes of various electricity generation systems, and to assign appropriate values to each attribute, including transportation requirements.

Nuclear power plants, in addition to making clean, reliable electricity at a stable price, also reduce stress on the nation’s transportation infrastructure. That is because they operate on a highly concentrated fuel that is required in only small volumes, and is delivered over existing highways by ordinary trucks. They hold 12 to 24 months of fuel in the reactor core, available whether or not the wind is blowing, or the sun shining, whether or not fuel arrives just in time through a pipeline, and whether or not the coal pile is frozen.

Despite these attributes, the electric system is drifting away from use of that technology, into generating plants that suffer from fuel interruptions and that put heavy strains on public infrastructure outside the plant fence.

As the Energy Information Administration pointed out in February, the Vermont Yankee nuclear power plant produced nearly 5 million megawatt-hours a year until its closure last December. EIA said that the likely substitutes were natural gas, coal or oil. Using EIA formulas, that would require 50.5 billion cubic feet of gas, or 26.25 million tons of coal or 57.5 million barrels of oil – or, more realistically, some combination of these, dominated by natural gas.

These are very large increments in a system that is already stressed.

According to the EIA, the six-state New England region has an import capacity of 3.9 billion cubic feet a day – assuming no bottlenecks within New England, and no constraints from New Brunswick, Quebec or New York, which is not the case. And during the last polar vortex, constraints on the gas infrastructure pushed prices in Boston above $70 per MMbtu, and electricity prices above $500 per MWh.

26.25 million tons of coal to replace Vermont Yankee every year.
Moving 26.25 million tons of coal into New England would require more than 200,000 car loads.

The Pilgrim nuclear power plant, of approximately the same design and vintage as Vermont Yankee but about 14 percent larger, is suffering through the same problems that doomed Vermont Yankee: a relatively small, single-unit plant with higher-than-average generating costs, competing in a market with electricity prices depressed by the generally low price of natural gas. Yet Pilgrim gets no credit for reducing the strain on the region’s overstressed gas pipeline network.

These problems are directly connected: one reason gas is cheap is because of under-investment in the pipeline network. The network is simply not set up for the level of reliability required by a strong electric system.

Five reactors in Illinois are not economic under the current market structure. They have a total capacity eight times larger than Vermont Yankee. Loss of any of those reactors would reduce the region’s ability to deal with weather-induced stress, or to export fossil fuel to the East.

Yet none of those plants gets any credit either for having years of fuel pre-staged on site.

The QER proposes spending up to $3.5 billion in Federal grants to help replace old pipelines, and up to $2.5 billion for energy transport systems. That doesn’t count private sector costs. Such government subsidies only serve to encourage more use of resources that tend to drive out nuclear plants, which are cleaner and do not require such help in bringing in fuel.

If heavy reliance on fossil energy requires more spending on fuel infrastructure, the rational approach would be to reflect the expense in the wholesale price of electricity from natural gas or coal. Failing that, if the government determines that such subsidies are, in fact, in the national interest, some countervailing step would be appropriate, to sustain electricity sources that relieve the stress on existing infrastructure. In competitive markets, this could take the form of reliability payments, putting a cash value on the money-saving attributes of nuclear power, which reduce the need to spend on new pipes and compressor stations, new rail capacity, new bridges, and new ports or waterway improvements.

UPDATE: The Committee has announced that Sec. Moniz's testimony has been postponed until June 2 at 10:00 a.m.

EDITOR'S NOTE: On Thursday morning, Energy Secretary Ernie Moniz is set to testify before the House Energy and Commerce Committee concerning the findings of the QER.


Tuesday, May 19, 2015

Business Rallies for Carolina Jobs & Ex-Im Bank

Ted Jones
The following is a guest post by Ted Jones, Director of International Supplier Relations for NEI.

For several months now, we've been shining a spotlight on the dispute in Washington over the reauthorization of the U.S. Export-Import Bank. But this week, the focus of this battle is moving outside the Beltway far away from Washington-based Tea Party groups to where real jobs are at stake - in this case on Wednesday morning in Charlotte where businesses from across the Carolinas are going to rally to support the bank and the work it does promoting exports in the region.

The event will take place at the Westin Charlotte Hotel beginning at 8:30 a.m. and will include businesses from all over the Carolinas. Already confirmed to be in attendance and participating are companies like Duke Energy, Holtec, CB&I, Fluor, Curtiss-Wright, GE Aviation and Boeing. We also expect a number of smaller nuclear energy suppliers - companies who would be forced to start laying off employees immediately without the help of the bank - to be in attendance to tell their stories.

The commercial nuclear energy industry is vitally important to the Carolinas. A study by Clemson University found that 29,000 jobs are generated by the nuclear industry in the two states. These jobs account for $4.2 billion in direct and indirect pay along with $1 billion in state and local taxes in the Carolinas. Without the Ex-Im Bank, a significant portion of that economic activity would be immediately jeopardized.

With North Carolina’s high commercial stake in global markets, a failure to renew Ex-Im Bank would be devastating to businesses and families in the state. For fiscal 2014, the bank approved transactions for hundreds of North Carolina exporters, supporting thousands of jobs. Contrary to the claims of Ex-Im Bank’s opponents, four out of every five transactions that Ex-Im Bank supports are for small or medium-sized exporters.

We'll be following the events in Charlotte on Wednesday morning via our Twitter feed. In the meantime, please take a look back in our archives at some of the previous articles we've written in support of Ex-Im Bank and the jobs that come with it.
Also, be sure to refer back to NEI.org and our landing page on Ex-Im Bank reauthorization.

Thursday, May 14, 2015

NEA: A Discussion on Climate Change

NEA-logo_blue_small2The Nuclear Energy Assembly wrapped up this morning with a panel on nuclear energy and its worth as a low carbon dioxide emitting energy source.

Low in this case means zero. That’s been true from the opening of Shippingport in the 50s and remains true. But it has taken on new significance in recent years.

The panel was called A Discussion on Climate Change. Panelists included  Philip Sharp, President of Resources for the Future, Christine Todd Whitman, Co-chairman of the Clean and Safe Energy Coalition and President of the Whitman Strategy Group, Armond Cohen, Executive Director of the Clean Air Task Force and Dan Reicher, Executive Director of Steyer-Taylor Center for Energy Policy and Finance at Stanford University.

This is an excellent group, ranging over the topic from their varied perspectives. We’ll provide a few highlights from each speaker, but the exchanges between them are very enlightening as well. You can view the 40 minute session here – if you need something to convince your friends, especially your greenest friends, that there’s a strong argument for nuclear energy, this is it.

These are my transcriptions. I’ve cleaned them up a little bit, but these folks are all polished speakers, so not much.

Sharp (who acted as moderator):

Sometimes you hear people say, well, after Fukushima, it’s all over, Americans don’t support nuclear power. I believe this is absolutely wrong. I believe there is no evidence that Fukushima reactivated the anti-nuclear movement in this country. …

All of these [climate change policy] studies come to the conclusion that we’re going to need over decades a portfolio of policies and we’re going to need a wide portfolio of low carbon fuels if we’re going to have a large impacts this. All of them include nuclear as a fuel that needs to be part of this…

Whitman, who was also the first Environmental Protection Agency administrator during the George W. Bush Administration:

I would like a national energy policy that says we want clean, green, reliable, affordable energy and leave it at that. And let the marketplace figure out the best ways to meet those goals.

We find more and more that people are saying yes, nuclear is too important. It punches way above its weight in what it provides in clean air, in what it provides with reliability and so they become more comfortable with the idea of expanding nuclear, living with nuclear …

Reicher:

In terms of technology, we need to put the pedal to the metal on every zero-carbon energy we have – and fast – if we’re going to address the climate crisis in the time frame most scientists have said.

I’m a major advocate of renewables and have been involved in their development and deployment in the business world and I am confident they will provide an increasing  and significant share of the world’s power supply over the next few decades, but I don’t think quickly enough to address the climate crisis.

Another zero-carbon technology, carbon capture and sequestration, is getting more real by the day. … The good news is that a diverse array of U.S. companies are moving forward with large scale CCS projects and industrial facilities…

So what about nuclear power? … In the case of existing U.S. reactors, climate math demands we carefully consider the fate of our 100 current reactors. … In the case of new U.S. reactors under construction, much rides on bringing them on line at a reasonable price in a reasonable time frame.

[Reicher does not think a carbon tax or cap-and-trade have much of a chance in Congress, but he does think that EPA’s pending rule on electricity generator emissions will survive court challenges and be implemented productively.]

Cohen:

The math of climate is absolutely brutal and I think this is what led folks like myself and other folks in the environmental movement increasingly to be having a conversation about nuclear’s role in a climate solution…

You’ve got to go to zero [carbon emissions] basically over 25 years while you’re increasing demand by two to three times. That’s a big circle to square. … We need to move faster and I would argue we need to move radically faster.

One thing we’ve seen from nuclear is that under the right conditions it can decarbonize power grids very rapidly because it comes in big chunks. France decarbonized its grid in 20 years, or at least decarbonized it by 75 percent, which is the number we’re looking for globally [to contain climate change.]

This just scratches the surface of their comments. There’s much more – a lot more to think about – and well worth your time.

Wednesday, May 13, 2015

Crane Highlights Energy Diversity, Markets & Trade in Nuclear Industry Keynote

Chris Crane
Christopher Crane is president and CEO of Exelon Corporation, and chairman of the Nuclear Energy Institute. This morning he spoke at NEA 2015 where he offered remarks to the state of the nuclear industry and its future. Below is a summary of his remarks. Click here for the full text.

Chris Crane made it clear from the outset of his address before more than 850 industry leaders this morning that the U.S. nuclear industry is at the top of its game. The latest WANO performance indicators clearly show the industry not only operated at-or-near record-setting levels in 2014, but has been doing so for a decade or more.

But Crane didn’t shy away from pointing out that there is a lack of recognition of “the importance of a diverse electricity supply” that poses serious ramifications for the nation.
Energy diversity is taken for granted and—if current trends continue—that diversity is seriously at risk.

Coal-fired generating capacity is declining. The U.S. has about 300,000 megawatts of coal-fired capacity. About 60,000 megawatts will shut down by 2020 because of tighter environmental requirements, and the Environmental Protection Agency’s proposed rule to reduce carbon emissions could lead to the retirement of another 40,000 to 45,000 megawatts of coal-fired capacity.

Since 1995, approximately 75 percent of all new electric generating capacity has been natural gas. Gas is clearly part of our nation’s strength in energy resources, but overreliance on gas could expose consumers of natural gas and electricity to price volatility and loss of reliability.

Renewables will play an increasingly large role but, as intermittent sources, they cannot displace the need for base-load generating capacity, absent dramatic advances in energy storage.
To prove his point, Crane cited a study done by IHS Energy, The Value of U.S. Power Supply Diversity released in July 2014 that compared the cost of generating electricity with the current generating mix against a less diverse system. The study’s conclusions are sobering.
IHS Energy examined the impact of energy diversity—or the lack of it—in a study sponsored by NEI, the Edison Electric Institute and the U.S. Chamber of Commerce. IHS compared the cost of generating electricity with the current generating mix and with a less diverse system.

In the lower-diversity case, the cost of generating electricity was $93 billion higher per year. Retail electricity prices were 25 percent higher. And the typical household’s annual disposable income was around $2,100 less. The effects would be similar to an economic downturn, according to IHS.

We need to intensify our efforts to increase awareness of the value of fuel and technology diversity in our electricity supply—and what is at risk if the U.S. stays on its current path.
To avoid the above scenario, another key priority for the nuclear industry is to create a level playing field so nuclear energy’s attributes are clearly recognized and valued. What are those attributes? Nuclear power plants achieved a record-high capacity factor of nearly 92 percent in 2014, as they have done since 2002 while operating in all kinds of weather conditions. And the linchpin to that performance is a direct consequence of the emphasis on safety.

Yet in spite of these accomplishments, nuclear generation, especially in competitive electricity markets, finds itself in a position of stepping into the batters’ box with two strikes before a pitch is thrown. As Crane sees it:
Market reform is essential so that nuclear energy’s attributes are properly valued and compensated. There are limited signs of progress—but much more remains to be done, and the time for action is now. We can ill afford the premature shutdown of more nuclear plants simply because of the economic strain resulting from poorly designed markets.

Regardless of the market structure, policymakers should consider transforming renewable portfolio standards into clean energy portfolio standards so that all carbon-free energy sources are treated equally.
Crane discussed the need for the Nuclear Regulatory Commission to prioritize its regulatory structure based on safety to allow nuclear plant operators to focus on “the most important work.” He also made a strong case for Congressional support for international trade in commercial nuclear technologies.
With 69 nuclear reactors under construction around the world and 183 new nuclear plant projects in development stage, commercial opportunities for U.S. vendors and suppliers increasingly are in international markets. Strategic national objectives are also in play. U.S. participation in the world market strengthens our ability to influence safety and nonproliferation policy and practices, and we can export our operational expertise.

NEI encourages the U.S. government to pursue a comprehensive nuclear energy trade policy recognizing that nuclear energy is a strategic asset in U.S. foreign policy. Key attributes of this policy include reform of U.S. export controls, enhanced export financing, facilitation of bilateral trade agreements with key trading partners, and development of workable international nuclear liability regimes.
The U.S. nuclear industry can point with pride at its accomplishments and has “an extraordinary value proposition” as Crane indicates throughout his address. Only an industry-wide effort and eternal vigilance will carry that message forward.

Editor's Note: For all of the latest from NEA 2015, please follow @NEI on Twitter as well as the #NEA2015 hash tag.