The Biden administration is launching a $ 6 billion effort to rescue nuclear power plants at risk of closure, citing the need to continue nuclear power as a carbon-free energy source that helps combating climate change.
A certification and bidding process opened Tuesday for a civilian nuclear credit program aimed at rescuing owners or operators of financial reactors in financial difficulties, the U.S. Department of Energy said exclusively in The Associated Press shortly before. of the official announcement. It is the largest federal investment to save financial reactors with financial difficulties.
Owners or operators of nuclear reactors expected to be shut down for economic reasons may apply for funding to prevent premature closure. The first round of awards will prioritize reactors that have already announced closure plans.
The second round will open in the most economically risky facilities. The program was funded with $ 1 trillion from President Joe Biden infrastructure agreementwhich he signed into law in November.
“U.S. nuclear power plants provide more than half of our carbon-free electricity, and President Biden is committed to keeping these plants active to meet our clean energy goals,” said Energy Secretary Jennifer Granholm. in a statement. “We are using all available tools to get this country clean with 2035, and this includes prioritizing our existing nuclear fleet to enable continued electricity generation without emissions and economic stability for communities that they are leading this important task. “
A strong majority of states, about two-thirds, say nuclear, in one way or another, will help replace fossil fuels. A dozen U.S. commercial nuclear reactors have been shut down over the past decade before their licenses expired, largely due to competition from cheaper natural gas, massive operating losses due to low electricity prices and rising costs, or the cost of major repairs.
According to the DOE, this has led to an increase in emissions in these regions, poor air quality and the loss of thousands of well-paying jobs, which is a blow to local communities. A quarter or more of the fleet is at risk, the DOE added. Owners of seven reactors in operation have already announced plans to withdraw them by 2025.
Most U.S. nuclear power plants were built between 1970 and 1990 and it is more costly to operate an aging fleet. The only nuclear power plant under construction in the United States is in Georgia. Costs have skyrocketed and another delay was announced in February.
Closed reactors include Indian Point Energy Center in New York, Pilgrim Nuclear Power Station in Massachusetts, Fort Calhoun Nuclear Generating Station in Nebraska and Duane Arnold Energy Center in Iowa. Entergy cited low natural gas prices and rising operating costs as key factors in its decision to close Indian Point last year. New York officials called for the shutdown, saying the plant 24 miles (39 kilometers) north of Manhattan posed too great a risk to millions of people living and working nearby.
Seth Wenig / AP
Twenty more reactors faced closure in the last decade before states intervened to save them, according to the Nuclear Energy Institute, the industry’s trade association. Illinois is spending about $ 700 million to keep three plants open while additional renewable resources go online.
Low electricity prices are the main cause of this trend, although federal and state policies to boost wind and solar have also contributed, the NEI added.
There are 55 commercial nuclear power plants with 93 nuclear reactors in 28 US states. Nuclear power already provides about 20 percent of the U.S.’s electricity, or about half of the country’s carbon-free power.
If the reactors shut down before their licenses expire, fossil fuel plants are likely to fill the gap and emissions will increase, which would be a substantial setback, said Andrew Griffith, the DOE’s deputy secretary of nuclear power.
While natural gas may be cheaper, nuclear power has not been credited with its carbon-free contribution to the grid and this has caused nuclear power plants to struggle economically, Griffith added.
The bailout for the nuclear industry is reminiscent of the aid received by the car and airline industries after the 2008 economic collapse and the coronavirus pandemicrespectively.
With just one month in office, former President George W. Bush authorized $ 25 billion in loans to General Motors and Chrysler from a $ 700 billion bailout initially intended to save more US banks. big. After President Barack Obama took office in 2009, he appointed a working group to oversee GM and Chrysler, which eventually went bankrupt. The companies received an additional $ 55 billion in aid and were forced to close factories and review operations before recovering and adding jobs. Most of the rescue loans in the industry have been repaid.
More recently, airlines received $ 54 billion in taxpayer money to keep people busy during the pandemic, but still eliminated tens of thousands of jobs by offering incentives for employees to leave or retire early.
David Schlissel of the Ohio-based Institute for Energy Economics and Financial Analysis said he wished the federal government, before allocating $ 6 billion, had looked into whether the money could have been better spent on increasing renewable energy, battery storage and energy efficiency. projects, which can be done quickly and economically to move fossil fuels.
Now that the money has been set aside for nuclear power plants, federal tax credits should be extended for renewables and more should be invested in energy efficiency, he said, so that the faster it is done. , faster reduces the nation’s dependence on fossil fuels and their emissions. In addition, nuclear power plants will eventually be withdrawn, some sooner rather than later, so there needs to be carbon-free energy sources for when they do, he added.
The Sierra Club has a nuclear-free campaign that says nuclear energy is not a solution to climate change and “every dollar spent on nuclear is a dollar less spent on truly safe, affordable and renewable energy sources.”
California is scheduled to close its last remaining Diablo Canyon nuclear power plant in 2025. Officials believe it could be replaced by new solar, wind and battery storage resources, although skeptics have questioned whether the California’s comprehensive renewable plan can operate in a state of about 40 million people.
The Department of Energy intends to accept annual applications for the civilian nuclear credit program until fiscal year 2031, or until $ 6 billion is exhausted. Owners or operators of nuclear power plants may bid for financial assistance to continue operating. To qualify, plant owners or operators must demonstrate that reactors are expected to be withdrawn for economic reasons and emissions will increase. The department will also determine, with the input of the U.S. Nuclear Regulatory Commission, that they can operate safely.
Maria Korsnick, president and CEO of NEI, said she believes the federal program will equalize the playing field for nuclear power and help clear a path to pass even more intensive policies, such as a tax credit for nuclear power. proposed nuclear production in the now stagnant Biden. Rebuild a better plan.
Democrats have said they hope to resurrect parts of the social and environmental package and win over tired voters from the two-year pandemic and the worst inflation in decades.
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