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Decision Time for Illinois Clean Energy

| May 22, 2016

The United States and other countries have set their sights on building a clean energy future. Whether that transition unfolds slowly or accelerates is an open question. But over the long run, most experts agree that we must head toward a low carbon energy future — not simply to avert catastrophic climate change, but also to reap the economic benefits of clean energy.

One of the implications of the changing landscape is that making long-term decisions based on short-term considerations will prove to be a costly mistake. It may not be raining very hard today, but that’s no reason to throw away your umbrella.

A perfect example of this phenomenon is the decision being made in a number of states to retire nuclear power plants — a decision that drives up air pollution, increases dependence on fossil fuels, undermines the reliability of the power grid, and likely will raise costs for consumers over the long term.

Our country’s 99 nuclear reactors are uniquely valuable because they do not emit carbon and provide “always on” base-load energy, with far fewer outages than any other source of electricity. Unfortunately, however, electricity markets across the U.S. either undervalue these attributes — or place no value on them at all. In many parts of the country, it is becoming increasingly difficult for nuclear power plants to compete with fossil fuel plants that are allowed to emit unlimited amounts of carbon dioxide and other pollutants into the atmosphere without penalty. The true price of those emissions is paid by society through health bills and insurance claims, storm response and recovery, and reduced productivity and quality of life.

Illinois is now grappling with this issue. Absent action from the legislature in Springfield, Exelon reports that it will be forced to shut down two of its modernized, emission-free nuclear power plants. These plants have operated reliably for decades and have been continuously upgraded to meet exacting standards of safety and performance. Despite the enormous and increasingly important long-term role they have to play as the state transitions to a clean energy future, the reactors in the Quad Cities and Clinton will be lost unless the state legislature acts soon.

How big of a setback could this represent for clean energy in Illinois? Last year, the state increased renewable electricity generation from wind and solar by 659 gigawatt-hours.[1] Shutting down the reactors in the Quad Cities and Clinton will eliminate about 25,000 gigawatt-hours of carbon-free electricity per year, overwhelming that progress by a factor of nearly forty to one.[2]

So while the growth in renewable energy generation is both significant and remarkable, it does not begin to make up for the loss of these two power plants. The sad fact is that the vast majority of the lost nuclear power would be replaced by fossil fuels, driving up carbon emissions.

Specifically, the Illinois Environmental Protection Agency reports that shutting down the two power plants will raise carbon emissions by more than 21 million metric tons per year. The cumulative impact on carbon emissions over 15 years would be roughly equivalent to the CO2 impact of lighting the entire U.S. Strategic Petroleum Reserve on fire.[3]

The reactors in Illinois are struggling financially for a number of reasons, including competition from natural gas, which is cheap today but is subject to supply disruption as well as to price volatility — witness the 2014 Polar Vortex. The potential imposition of a carbon price — which does not exist today but is widely expected at some point — could make overreliance on natural gas costly indeed. But once the reactors have been shut down and the decommissioning process has begun, restarting will be impossible.

State officials in Illinois should act quickly to realign the incentives in the electricity market more fairly to reflect the value of the carbon free, base-load energy that nuclear power provides. This is not about subsidizing one form of energy over another. It is about leveling the playing field so that the full costs and benefits of every source of electricity are fairly reflected in the marketplace.

[1] U.S. Department of Energy, Monthly Generation by State, Producer Sector and Energy Source. Wind & Solar generation for the Total Electric Power Industry in Illinois increased from 10,136,984 megawatthours in 2014 to 10,795,944 megawatthours in 2015, an increase of 658,960 megawatthours (659 gigawatthours).

[2] Illinois EPA Report, January 2015.

[3] A report by the Illinois EPA found that impact of shutting 3 reactors is 21.5 million metric tons of CO2 per year. According to the U.S. EPA’s online GHG calculator, 21.5 million metric tons of CO2 is equivalent to the CO2 content of 50 million barrels of oil. That amounts to 750 million barrels over 15 years (15 years x 50M barrels per year = 750M barrels). This is more than the U.S. strategic petroleum reserve, which now holds 695 million barrels out of a total capacity of 714 million barrels.

For more information on this publication: Belfer Communications Office
For Academic Citation: Poneman, Daniel.“Decision Time for Illinois Clean Energy.” Medium, May 22, 2016.

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