Friday, May 05, 2017

Pitting Wind and Solar Against Nuclear Power

  • With US electricity demand stalled, expanding wind and solar power is increasing the economic pressure on equally low-emission nuclear power.
  • New state incentives for nuclear plants are facing resistance from the beneficiaries of renewable energy subsidies, as both battle for market share.
It’s an old adage that a growth market has room for all participants, including new entrants. The US electricity market is now experiencing the converse of this, with increasing competition for static demand leading to headlines like the one I saw earlier this week:  “Lifeline for Nuclear Plants Is Threatening Wind and Solar Power.”

The idea behind that headline is ironic, considering that for more than a decade renewables have depended on government mandates and incentives to drive their impressive expansion. Along with recently cheap natural gas, they have made conditions increasingly difficult for established generating technologies like coal and nuclear power.  In the case of coal, that was an entirely foreseeable and even intentional outcome, but for nuclear power it has come as a mostly unintended consequence.

Much as the slowdown in gasoline demand brought on by the recession created a crisis for biofuel quotas, stagnant electricity demand has hastened and intensified the inevitable fight for market share and the resulting shakeout in generating capacity.  US electricity consumption has been essentially flat since the financial crisis of 2008-9, thanks to a weak economy and aggressive investment in energy efficiency.  More generation serving the same demand means lower prices for all producers, and fewer annual hours of operation for the least competitive of them.

At the same time abundant, low-priced natural gas from soaring shale production has made gas-fired turbines both a direct competitor in the 24/7 “baseload” segment that coal and nuclear power formerly dominated, and the go-to backup source for integrating more renewables onto the grid.

The US is essentially swimming in energy, at least when it comes to resources that can be turned into electricity.  The only rationale left for the substantial subsidies that wind and power still receive–over $3 billion budgeted for wind alone in 2017–is environmental:  mainly concerns about climate change and the emissions of CO2 and other greenhouse gases linked to it.

That’s the same reason why some states have become alarmed enough by the recent wave of nuclear power plant retirements to consider providing some form of financial support for existing facilities.  Nuclear power isn’t just the third-largest source of electricity in the US; it is by far our largest producer of zero-emission power:  3.5 times the output of wind in 2016 and 22 times solar.  A large drop in nuclear power is simply not compatible with the desire to continue cutting US emissions.  Environmental groups like EDF are reaching similar conclusions.

(Credit: Click to Enlarge.
Nuclear’s scale is even more of a factor when it comes to considering what could replace it.  For example, it takes the output of about 2,000 wind turbines of 2 megawatts (MW) each–roughly half of the 8,203 MW of new US wind installations last year–to equal the annual energy production of a single typical nuclear reactor.

Read more at Pitting Wind and Solar Against Nuclear Power

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