Nuclear power legislative allies release report, call for state action to save industry

Nuclear power legislative allies release report, call for state action to save industry

Author: Stephen Caruso/Thursday, November 29, 2018/Categories: News and Views

A bipartisan group of General Assembly members, surrounded by cheering plant employees in a cramped Londonderry firehouse, released a report Thursday that called on their colleagues to take action and support the flagging nuclear power industry.

Sen. Ryan Aument (R-Lancaster), a co-chair of the Nuclear Energy Caucus, laid out high stakes if the industry, which produces 42 percent of the state’s electricity, was left to perish as energy prices plummet, at least partially because of competition from natural gas.

“We’re not talking about a bailout, we’re not talking about a subsidy, we’re talking about valuing each resource appropriately,” Aument said. “Basing long-term energy decisions on short-term price...I think that’s foolish.”

Pennsylvania currently has nine nuclear reactors operating at five sites across the state. Two of those plants, Beaver Valley in Beaver County and Three Mile Island outside Harrisburg, have already announced plans to close within the next three years, reducing the state’s nuclear capacity by a fourth.

A report from the Brattle Group, published in 2016 and financed by state business groups and trade unions, estimated that state electricity costs would increase by $788 million per year without any nuclear plants. It also linked the industry to nearly 16,000 jobs directly and indirectly.

Nationally, five nuclear plants shut down between 2013 and 2016, while industry executives presented a bleak picture during caucus hearings this year without state intervention.

Industry allies point to the economic benefits as well as environmental perks of nuclear energy, which does not release carbon that contributes to climate change or other pollutants.

The plan, made up of years' worth of testimony to the caucus, offers up four solutions, including adding nuclear energy to the state’s existing alternative energy portfolio standard, adopting some form of carbon pricing or doing nothing.

The fourth scenario involves waiting on a ruling, expected for January 2019 from the Federal Energy Regulatory Commission, to clarify regional electricity distributor PJM Interconnection's energy auction practices and designing a system that folds into the new ruling.

Nuclear allies have claimed that PJM’s policies and prices haven’t been flexible enough to account for nuclear energy's higher capital costs, while state policy hasn’t as readily credited the industry as a carbon-free energy source.

The caucus report also lays out that the latter option could entail folding nuclear energy into the existing portfolio system before adding a system of carbon pricing later as a long-term solution.

In the recent reporting period, Pennsylvania consumers spent $122.7 million to shore up clean energy generators through the state’s existing alternative energy portfolio, passed in 2004 under former Gov. Ed Rendell.

However, numbers like that are what help drive opponents of state action in favor of the nuclear industry.

The No Nuke Bailout Coalition, made up of state natural gas and oil interests, the AARP and National Federation of Independent Businesses PA chapters, have fought against any specter of state intervention.

Citing concerns over nuclear company profits and a billion in subsidies in other states, the coalition decried the caucus’s report as anti-competitive.

“Our coalition values all sources of power generation; however, regulators at all levels have confirmed that the markets are working and that the electricity grid will remain reliable and resilient, calling into question the need for any policy change that would destroy the state’s competitive electricity marketplace,” their statement read.

At least one powerful member of the General Assembly seemed to agree. Senate President Pro Tempore Joe Scarnati (R-Jefferson), in a press club luncheon earlier this year, seemed skeptical when asked about legislative action for the industry, comparing it to picking winners and losers.

In a statement, JJ Abbott, spokesperson for Gov. Tom Wolf, cut a more concerned tone, citing potential losses of jobs and livelihood, while steering clear of providing his direct support.

“Governor Wolf believes we need a robust conversation about our energy economy and looks forward to engaging with the General Assembly about what direction Pennsylvania will go in regards to its energy sector, including the future of nuclear power and the value of lower emission energy for Pennsylvania’s economy and environment,” Abbott said in an emailed statement.

But for Rep. Tom Mehaffie (R-Dauphin), whose district abuts Three Mile Island and includes many plant employees, spending some money up front to keep the plants going was simply prudence.

“I call that an insurance policy,” Mehaffie said. “We want to make sure there are no blackouts and brownouts.”

Whether removing nuclear power would lead to a less reliable power grid is an active point of contention. PJM claims the concern is overblown.

“PJM’s region is reliable now and into the foreseeable future, with healthy capacity reserve margins,” the company said in a statement and backed in a recent report.

The only exception would be in the case of a combination of a polar vortex-like event and an accelerating shutdown of power plants, which allies have seized on.

For his part, Aument said he hopes the report starts a conversation with his fellow members and leadership on what the legislature can do.

But turning conversation into action? "I think without question, it's going to be a fight," Aument said.

But if it's a fight, it has a simple answer to Eric Daw, a 49-year-old veteran who worked on nuclear warships.

Daw is currently employed at the Beaver Valley plant and was bussed out to Londonderry, in the shadow of the likewise closing Three Mile Island, to stand with the caucus.

He’s worked at the plant for five and a half years and sees himself leaving Pennsylvania if the plant continues to shutdown.

Pointing to the billions offered to Amazon and the Shell Cracker, he doesn’t see the big deal in having the state chip in to keep nuclear plants running.

“We’re asking for equal footing,” Daw said. “You can’t just turn it back on again four years later.”

Stephen Caruso is the Harrisburg bureau chief at The PLS Reporter. Have a question, comment or tip? Email him at stephen@mypls.com.

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