- The Washington Times - Monday, September 2, 2013

The closing of Vermont’s only nuclear power plant is the latest challenge to an industry struggling to retain its niche in America’s long-term energy future.

The Vermont Yankee facility, owned and operated by Louisiana-based energy firm Entergy Corp., is one of at least five reactors to be slated for closure in the past 12 months.

Several factors have combined to create what some see as a bleak future for the sector.

“This is not an isolated incident,” said Frank Felder, director of the Center for Energy, Economic and Environmental Policy at Rutgers University. “Electricity prices are low. The costs of running the plants are high.”

Much like coal, nuclear power — once heralded as the future of U.S. energy and still touted by President Obama as part of his “all of the above” strategy to reduce dependence on foreign fuel — now is fighting to compete with natural gas prices near record lows.

The rise of hydraulic fracturing, a process commonly known as fracking, has revitalized American natural gas production. The dramatic rise in supply has pushed down prices in recent years and made gas increasingly appealing from a cost perspective.

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The uptick in drilling has coincided with a drop in overall demand for electricity, analysts say, a one-two punch that may begin to elbow nuclear out of the mix.

Meanwhile, events such as the disaster at Japan’s Fukushima Dai-ichi facility have renewed questions about the overall safety of nuclear power and led some nations, such as Germany, to begin transitioning away from nuclear energy.

But with the Obama administration bent on reducing U.S. carbon emissions, nuclear power would seem on the surface to be a worthwhile investment. In terms of carbon emissions, nuclear plants are cleaner than natural gas facilities and are much more “green” than their coal counterparts.

Despite that, the bulk of federal clean-energy investments continue to flow to solar, wind, biofuels and other alternatives.

“Nuclear is not as sexy,” said Eileen Supko, principal at Energy Resources International Inc., a leading energy consulting company.

In fact, many of those advocating a transition to a low- or no-carbon future see a diminished — or nonexistent — role for nuclear power generation.

“This is the right decision for Vermont as we move to a greener energy future. Entergy’s announcement today confirms what we have known for some time. Operating and maintaining this aging nuclear facility is too expensive in today’s world,” Vermont Gov. Peter Shumlin, a Democrat, said after Entergy announced the Vermont Yankee closure last week. “Vermont has made clear its desire to move toward more sustainable, renewable sources of electricity, and many of our surrounding states are doing likewise.”

In explaining its decision, Entergy cited a “natural gas market that has undergone a transformational shift in supply due to the impacts of shale gas.”

The company also pointed to the high costs of maintaining the single-reactor Vermont Yankee facility, having spent more than $400 million on the plant in the past decade.

Single-reactor sites, analysts say, are especially vulnerable because they produce fewer megawatts but carry high upfront capital and maintenance costs.

“You don’t have the same ability [to control costs] that you do with a multiunit plant if it’s a single-unit facility, you’re not spreading your costs over more megawatts,” Ms. Supko said.

Nuclear facilities with more than one reactor simply offer more bang for the buck, she added.

But Ms. Supko disputed the notion — floated by many analysts in the wake of the Vermont Yankee announcement — that nuclear power as a whole is on a clear downward trajectory. The future of nuclear power, she said, has been in doubt before, but its long-predicted demise hasn’t come to pass.

The 100 remaining nuclear reactors in the U.S. generate about 20 percent of the nation’s electricity, according to the Nuclear Energy Institute.

The newest U.S. commercial reactor was built in 1996, but five — two in South Carolina, two in Georgia and one in Tennessee — are under construction.

The Nuclear Energy Institute said other facilities are being considered or are under review by the federal Nuclear Regulatory Commission.

While government investment largely has been centered on wind and solar power, nuclear energy generates far more electricity than those sources and other low- or no-carbon fuels. Of fuels with minimal or no carbon emissions, nuclear accounts for 63 percent of U.S. electricity generation, the institute said.

Industry leaders recognize that, in order for nuclear power to be an integral part of the U.S. energy portfolio moving forward, the sector’s environmental benefits must be front-and-center in the minds of the American people and their elected leaders.

“Our nation’s energy security, economy and environment all suffer when energy markets fail to value the attributed intrinsic to nuclear energy — namely clean energy with virtually no air emissions,” said Marvin Fertel, president of the Nuclear Energy Institute.

The organization hasn’t explicitly endorsed a carbon tax or a similar measure, but there is little doubt that those steps — favored by the Obama administration but unable to pass Congress — would be a boon for nuclear power.



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