Aug
03
2016

SNL Energy: Electricity Generation At Risk

Could substantial portions of America’s generating fleet be taken offline in the near future? The answer, unfortunately, is yes according to a recent SNL Energy analysis.

powerlines

According to a recent report from Utility Dive, SNL Energy found that 21,537 megawatts of generation from coal, natural gas, and nuclear power are “at risk” for shutdown through 2020. These three sources are classified as baseload sources of power, meaning they are capable of generating electricity virtually all of the time with minimal interruption. To make its determination, SNL Energy looked at the age of various plants, as well as other factors.

The analysis doesn’t paint a hopeful picture for meeting the future demands of customers with conventional power generation. Many of the plants that SNL Energy examined were nearing or beyond their estimated useful life or had negative operating margins. Other plants are under tremendous financial pressure because of their competition with historically low natural gas prices.

For example, Entergy has announced plans to shutter its Pilgrim Nuclear Power Station no later than June 1, 2019. Entergy already closed its Vermont Yankee nuclear facility and plans to close its Fitzpatrick nuclear plant in New York in 2017. In the nation’s heartland, Exelon is shutting down its Clinton and Quad Cities nuclear plants in Illinois.

Shutdowns have been particularly hard among coal-fired power units. Indianapolis Power & Light has retired four units at its Eagle Valley Generating Station. This past April, in just one day, the Midwest saw 2,000 megawatts of coal-fired power disappear from the grid. Those included coal-fired plants operated by Duke Energy Indiana, Consumers Energy, and Holland Board of Public Works in Michigan.

“The amount of generating capacity we are seeing disappear from the grid should be cause for concern for anyone looking seriously at America’s energy future,” explains PACE Executive Director Lance Brown. “Our nation’s regulators, elected officials, and utility leaders must continue to work together to ensure that capacity exists to power our homes and businesses in the coming years.”