20 Jul Analysis: Nuclear Subsidies Bad for Climate
NEW ANALYSIS FROM LEADING SCIENTIST SHOWS SUBSIDIZING FAILING NUCLEAR PLANTS IS BAD FOR THE CLIMATE
Climate Rationale Undermined for New York Nuclear Bailout
A new, independent analysis from one of the country’s leading energy experts examining the rising trend of subsidizing aging, unprofitable nuclear power plants — like the $7.6 billion deal the Cuomo administration has made New York electric utility ratepayers pay — shows that propping up these old plants harms the environment and hinders states’ ability to meet climate goals.
The analysis from Amory B. Lovins, Chief Scientist at the Rocky Mountain Institute, found that closing the nuclear power plants and reinvesting just their operating costs into energy efficiency (ways to reduce energy consumption, such as better insulation, windows, appliances, etc.) saves more carbon, decreases utility costs for consumers, and increases the reliability of the energy grid. And it does all this without charging ratepayers an extra dime for subsidies.
“I believe the claimed climate benefits of subsidizing nuclear plants are illusory, because of climate opportunity costs: avoiding and properly reinvesting nuclear operating costs could save even more carbon,” says Lovins. The analysis is forthcoming in The Electricity Journal.
The costliest nuclear power plants in the country — which are the ones the public is now being asked to bail out — cost an average of 6.2 cents per kWh to operate. In contrast, utilities can buy energy efficiency for their customers at an average of 2-3 cents per kWh. This means that for the same price, energy efficiency could replace the electricity from a nuclear plant as well as reduce the overall demand for electricity, displacing kWh derived from fossil fuels, thereby cutting emissions. Ratepayers are already footing the bill for nuclear plants’ operating costs, even without subsidies. In this scenario, that money is simply redirected to energy efficiency instead, giving ratepayers more bang for their buck, eliminating the need for subsidies, and reducing emissions.
His findings, while not specifically directed New York, contradicts the argument that the Cuomo administration has given for the nuclear bailout in New York, which will hike utility rates via hidden surcharges for the subsidies for over a decade. The administration has repeatedly claimed that all New York ratepayers — including residents, schools, hospitals, non-profits, even the cash-strapped MTA — must fork over billions in extra fees to the Chicago-based nuclear power plant company Exelon to help the state meet its climate goals to reduce carbon emissions.
Because operating costs on individual plants are not public, Lovins used the latest aggregated data from the Nuclear Energy Institute for his analysis. Therefore, it is not possible to break out data specifically for New York. However, in a recent interview in Carbon Brief, Lovins said that policymakers in New York and Illinois, which also just passed a multi-billion dollar bailout plan, “succumbed to the incorrect argument that they should subsidize the operation of their nuclear plants in order to keep saving carbon [emissions].”
Their rationale was “incorrect,” he argued, because, “the reason the plants are distressed and cannot compete on operating cost is the operating cost is so high. High enough that for every kWh you don’t generate in such a reactor, you could buy approximately three kWhs of efficiency at the average price the utilities actually pay for it.”
Members of Stop the Cuomo Tax applaud the analysis and urge the governor to finally reconsider his plans to hand over $7.6 billion in ratepayer money to Exelon.
“Gov. Cuomo’s $7.6 billion nuclear bailout benefiting a single, out-of-state Fortune 100 company never made sense — either for ratepayers or the environment. Amory Lovins’ analysis clearly shows why. Investing in outdated nuclear technology is a far more expensive way to achieve climate goals, and hurts the planet by prioritizing nuclear power over energy efficiency,” said Blair Horner, Executive Director of the New York Public Interest Research Group and a leader of the Stop the Cuomo Tax campaign. “Lovins also finds that bailouts like the one the Cuomo administration engineered are costing ratepayers more money instead of less in the long run, so there is absolutely no reason for New York to continue down this path,” he added.
“Gov. Cuomo hasn’t listened to environmentalists and good government groups fighting the bailout in New York. Hopefully, he will listen to Amory Lovins, whose climate and energy record is unparalleled, when he says that nuclear bailouts are costly, environmentally destructive, and ultimately harmful to our electricity grid. If Cuomo wants to be an environmental leader, he must end the bailout once and for all,” said Alex Beauchamp, Northeast Region Director of Food & Water Watch and a leader in Stop the Cuomo Tax.
Read a summary of the Amory Lovins analysis here.
Download Analysis PDF