Ohio, USA, subsidises renewables. Now the Ohio State Legislature is fighting over a bill that will re-shape and extend that support to all clean energy, including nuclear. That’s how it should be, says Jim Conca. He reviews a report by regional transmission organisation PJM that says keeping nuclear plants open is far cheaper. Moreover, it’s far better for emissions. That’s because whenever a nuclear plant is shut down in the U.S. it is replaced by carbon-emitting gas, not renewables.
Debate rages in the Ohio Legislature over Ohio House Bill 6, legislation that is highly misunderstood. The bill, passed by the Ohio House on May 29th, would sunset the State’s prescriptive renewable-only subsidies and green energy mandates in favour of a seven-year program compensating Ohio’s two nuclear plants for their larger-scale environmental and economic benefits, and providing more general subsidies to all “clean-energy” sources including renewables.
The misunderstanding of House Bill 6 can be seen in the odd, even ludicrous, alliances for and against it. The Ohio Republican House Speaker with some key Democratic support, First Energy Solutions, labour unions, nuclear power advocates, and local officials on one side, and some self-styled green groups, the fossil fuel industry, renewable energy companies, and some conservative organisations on the other.
Environmentalists, fossil fuel firms lobby against nuclear
Huh? Environmental groups joined with fossil fuel? This is a classic effect of some environmentalists and lobbies not understanding nuclear power and leaning on old ideologies against it. Renewable energy companies siding with fossil fuel companies is not surprising as both know that increasing renewables without nuclear means more natural gas.
Thinking that we need to choose between low-carbon sources is a false choice. Both need to be supported.
In an attempt to better understand the fiscal effects of this Bill, the Ohio Consumers’ Counsel and the Pennsylvania Public Utility Commission requested that the regional transmission organisation PJM issue a report to illustrate the impacts of nuclear plant retirements on both market prices and emissions concerning the nuclear plants in Pennsylvania and Ohio.
Impacts of nuclear plant retirements
PJM is one of the largest regional transmission organisations (RTO) that coordinates the movement of wholesale electricity in 13 states and the District of Columbia, and best knows the effects of such legislation on both cost and grid reliability. Last week, PJM released the study which said the following:
– If all the nuclear plants stay open, the regions ratepayers would save $2.1 billion and prevent the release of 19.4 million tons of carbon
– If the nuclear plants close, the savings would be less at $1.6 billion and the emission of only 4.3 billion tons of carbon would be avoided.
It was bizarre that most news outlets chose to tout only the latter point as being worthwhile, although PJM did kind of bury the first point late in the report.
Critics pointed out that the report gave an inaccurate picture, because it didn’t factor in a number of changes the bill would make, including eliminating Ohio’s green energy mandate, which drives utility procurement of renewables in the state, as well as the nuclear subsidies, which are expected to cost $190 million annually through 2026.
Other critics point out that the report underestimates the social cost of carbon, which undervalues the benefits of nuclear power to the ratepayer. If emitted carbon is valued at $44/ton, then retaining nuclear would save ratepayers $776 million by 2023 without natural gas additions. They also pointed out that the bill still rewards renewables, just not only renewables.
Keeping these nuclear plants online also results in further reductions of SO2 (8,500 tons) and NOx (9,700 tons), which are both significant contributors to poor air quality, including smog and particulate pollution. These result in a 10% increase in health care costs to Ohioans. Together with consumer savings of almost $500 million, this is a big win for citizens across the PJM region.
But focusing on the nuclear subsidy in the bill misses the other more important points. The nuclear subsidy of $190 million annually, which is just under a penny per kWh, is much less than the renewable subsidy of $475 million, which is two and a half pennies per kWh, for producing the same amount of electricity from wind and solar.
House Bill 6 supports all clean energy, instead of just renewables
OH House Bill 6 actually results in lower charges to ratepayers by preserving the nuclear plants and still adding more renewables, as renewables are “clean-energy” sources and will get their subsidy. That’s because the Bill replaces the word renewable with clean or non-emitting.
Upon enactment, the $4.39 average monthly surcharge paid by Ohio electricity customers for the renewable mandates would be eliminated, replaced by a monthly surcharge of only $0.50 for residential customers in 2020 and $1.00 from 2021 through 2026; $10 for commercial customers in 2021 and $15.00 thereafter, $250 for industrial ratepayers and $2,500 for very large power users.
That pool of money, about $190 million each year, would be distributed to Ohio’s zero-carbon nuclear plants in the form of a credit of 0.900 cents for each kWh of electricity they create.
Gas, not renewables, is replacing nuclear
It is important to realise that the Perry and Davis-Besse nuclear plants in Ohio provide over ten times more non-emitting electricity than all the State’s wind and solar combined. If they are closed prematurely, there is no hope of replacing that amount of non-emitting power with renewables by 2030, even with extreme applications of energy efficiency.
Which is why fossil fuel concerns are against this Bill. They know the replacement for nuclear will be natural gas, contrary to what pro-renewable folks claim. Although better than coal, gas is certainly not emission-free, and every time a nuclear plant has closed in America over the last ten years, it has been replaced by gas, increasing those state’s carbon emissions.
I guess global warming doesn’t matter to the critics of this Bill, which makes crowing about hurting the green energy mandate disingenuous at best. They might be forgiven as they don’t actually listen to climate scientists and just parrot anti-nuke nonsense.
The world’s top climate scientists, including Dr. James Hansen, Dr. Tom Wigley, Dr. Ken Caldeira and Dr. Kerry Emanuel, have all urged world leaders and environmental campaigners to stop their unscientific and ideological attacks on nuclear energy and support its expansion.
They have also warned that the anti-nuclear position of environmental leaders is causing unnecessary and severe harm to the environment and to our planet’s future by prolonging carbon emissions. Even the Union of Concerned Scientists says we need nuclear to address global warming.
By any measure that includes environmental concern or even cost, it is foolish to close any nuclear power plant that has been relicensed by the NRC and is producing power continuously 90% of the time for only a penny or so more per kWh than natural gas.
U.S. carbon emissions rose in 2018 by over 60 million tons of CO2. Closing six nuclear plants over the last few years, building new gas plants, increasing manufacturing and construction, and increasing gasoline/diesel/jet fuel demand are the reasons for this rise. Increased renewables and increased energy efficiency have not been able to keep up with any one of these effects.
The message from the PJM report is clear – stop closing nuclear plants over less than a penny a kilowatt-hour.
Dr. James Conca is an earth and environmental scientist and a regular contributor to Forbes magazine