Jan
16
2017

Indian Point Closure Threatens New York City

Last week, New York Governor Cuomo announced the completion of one of his long awaited goals: closing down the Indian Point nuclear plant. The plant will shut down completely in just four years, leaving many questions about what will fill the gap to keep the power on in New York City. Today, the city receives an incredible one third of its electricity from the plant.

Perhaps most troubling is that there are no current plans to build a new nuclear plant, a coal-fired plant, or pipelines to transport more natural gas from Pennsylvania. (Note that New York State has banned fracking in the fossil fuel rich northern part of the state.) There aren’t enough roofs in Manhattan to generate ample solar energy to power the city. Even if there were, solar’s cost would be astronomically higher than the cost of inexpensive power produced by Indian Point. Conservation isn’t a viable solution either. New York City won’t be able to cut its energy usage by 30%, especially since the city’s peak demand has been increasing in recent years.

Could wind power be the answer for New York City? Currently, all of the wind turbines in New York State combined have roughly the same capacity as Indian Point. However, since wind power is intermittent, Indian Point actually supplies about four times more electricity than those turbines. That means replacing Indian Point with wind power would require increasing New York’s wind farm capacity by at least 400%. That’s an obvious challenge for planners, especially because of the battery storage technology that would be required to deliver the kind of stability New Yorkers deserves.

To understand the scale of the challenge, consider that about 50 million kWh of electricity would have to be stored in batteries to power NYC for just one windless day. The entire world produces only enough batteries to store about 35 million kWh annually. So filling the gap left by Indian Point would require purchasing about 40% of all the lithium batteries produced on the planet for the next four years. A battery system of that magnitude would cost nearly $50 billion. That doesn’t seem likely, even for a city as environmentally ambitious as New York.

The more practical solution? Construct a new natural gas plant at a cost of around $2 billion to supply the needed power. Or better yet, provide Indian Point financial incentives to remain in operation, costing a few hundred million dollars. Neither one of those options seems likely, though, given Governor Cuomo’s disposition toward nuclear power an fossil fuels.

PACE has written before about the importance of nuclear energy. As many as two thirds of U.S. nuclear plants face premature closure, posing a real threat to our nation’s baseload electricity supply. Indian Point represents a powerful example of how difficult it can be to replace the low-carbon, low-cost energy provided by nuclear units. Hopefully, the nation’s leaders soon will take action to revitalize the nation’s nuclear power industry and avoid situations, like the one that New York is facing, that threaten the availability of power.

Jan
11
2017

Repealing Coal and Methane Rules Priority for Congress

With a new administration taking office later this month, House Republicans have pledged to make repealing the Obama administration’s regulations on coal mining and methane emissions a top priority.

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House Majority Leader Kevin McCarthy (R-CA) says the Republicans will first plan to work on changing the way the executive branch writes rules and then focus on undoing specific rules. EPA rules that address the coal industry and methane will be at the top of the list.

“While we haven’t yet determined what needs to be repealed first, I expect to start with swift action on at least on the Stream Protection Rule and methane emissions standards, both of which are limits to our energy production,” said McCarthy in a speech last week. “This process won’t be completed quickly, but as we remove harmful regulations and change the structure of Washington, draining the bureaucratic swamp that undermines the will of the people, we can rebuild trust between the people and their government again.”

The message appears to coordinate with President-elect Trump’s larger plan to rein in overreach from federal agencies.

The Stream Protection rule was finalized by the Interior Department last year. It would create new standards for how coal mining companies protect and restore streams. Experts believe it is likely to further hurt the U.S. coal industry. In addition, EPA and the Interior Department have both written rules intended to limit methane emissions from oil and natural gas drilling. Together, the rules will raise the cost of production for oil and natural gas.

Because the rules were finalized last year, Congress still retains to repeal them using the Congressional Review Act. That might very well happen. According to Majority Leader McCarthy, the rules were an effort by the Obama Administration to “unilaterally impose regulations on his way out of the door.”

For his part, President-elect Trump has also vowed to fight the Stream Protection rule and any other rules restricting energy production.

Additional legislative help could be on the way too. The House soon will vote on a pair of bills that would make executive overreach more difficult in the future. One of them, the Regulations from the Executive in Need of Scrutiny or REINS Act, would require Congress to approve any new rule that would have a significant impact on the economy. Another, the Regulatory Accountability Act, would help lawmakers make better decisions about how major rules will affect the economy.  Lawmakers may also vote on a new bill that would allow Congress to overturn all of President Obama’s “midnight regulations” that affect the economy.

Reining in federal overreach that threatens the energy industry is important for both our economy and our power grid. Hopefully, Congress and President Trump can work together to get our regulatory agencies back on the right track.

Jan
04
2017

Nuclear Power At Risk?

There is widespread agreement across the political spectrum that increasing the amount of low-carbon energy on the grid is an important priority for the future of the U.S. and the rest of the world. PACE has argued that nuclear power is an indispensable part of the solution for meeting future power demand. Many climate activists agree. That is why it is concerning to hear that nuclear capacity in the U.S. could actually be decreasing rather than growing.

Environmental Progress, a green advocacy group, announced just last week that at least a quarter and as many as two-thirds of all U.S. nuclear plant reactors are at-risk of being prematurely shuttered. Even with critical action being taken in New York and Illinois, as much as 65 gigawatts of nuclear generating capacity are at risk of closure before 2030,

“If half are closed and replaced with natural gas,” the group writes, “the additional carbon emissions would be the equivalent of adding roughly 50 million cars to the road.”

According to the assessment by Environmental Progress, 35 gigawatts of nuclear power is considered in “triple risk” because those plants exist today in deregulated markets and are up for relicensing prior to 2030.

That level of uncertainty regarding nuclear power is unfortunate for customers on a number of levels. Nuclear power today represents about a fifth of the nation’s generating capacity, providing low-cost electricity that is nearly uninterrupted throughout the course of the year. The almost complete dependability and low fuel cost of nuclear power combine to make it a useful hedge against commodities whose price fluctuates over time. In other words, losing nuclear capacity doesn’t just means losing electrons. It means losing some measure of control and certainty over the future.

This past December, PACE used this line of reasoning to encourage the Georgia Public Service Commission to continue its support of Plant Vogtle in east Georgia. In an environment that is seeing nuclear plants put at risk, Vogtle represents at least a meaningful blip on the radar for anyone searching for an American nuclear renaissance. In the end, we believe Georgia regulators did the right thing by securing the future of Vogtle. Let’s hope U.S. policy makers take note and ensure that nuclear power continues to be a backbone of American power into the future.