Report: Losing FirstEnergy’s Nuclear Fleet Would Wipe Out Two Decades of Solar and Wind Progress

FirstEnergy’s plans to shut down nuclear power plants has focused the attention of clean energy boosters on environmental impacts. FirstEnergy's three nuclear plants under threat generate more zero-carbon power than all of the mid-Atlantic region’s wind and solar power put together. 

On Monday, research firm The Brattle Group released its own analysis in the wake of FirstEnergy’s planned nuclear closures, underscoring a worrisome combination of environmental and economic costs.

Brattle Group’s study was conducted for industry advocacy group Nuclear Matters. It looks at the effects of closing FirstEnergy’s two Pennsylvania plants and one Ohio plant, in combination with Exelon’s Three Mile Island nuclear power plant. All four plants are losing money in the face of competition from cheap natural gas, flat demand for energy and rising operations costs. 

Other utilities are seeking lifelines for struggling nuclear reactors in the form of state zero-carbon energy credits and other mechanisms to reward their carbon-free generation capacity. There's no doubt that closing the four plants would leave a huge hole in the zero-carbon capacity serving mid-Atlantic grid operator PJM — 21 million metric tons annually, according to Brattle Group’s analysis. 

The four plants now provide more zero-carbon energy than all of PJM's wind and solar energy combined, making them an integral part of the region's clean energy mix. If the plants close, the increase in carbon emissions could raise social costs of about $921 million per year over a 10-year period, based on a federal measure of carbon pollution. Adding in other fossil fuel generation pollutants and their associated societal costs increases that amount by $170 million per year, bringing total societal costs to more than $1 billion. 

Keeping these four plants open would also help keep electricity prices lower that they will otherwise be, the analysis indicates. “With these plants operating, customers’ annual gross electricity costs could be as much as $400 million lower in Ohio and $285 million [lower] in Pennsylvania. Across all of PJM, electricity costs could be as much as $1.5 billion lower,” the report concluded.

This calculation is based on several assumptions, Brattle Group noted. First, it is based on studies first published in December 2016 and April 2017, meaning older data is almost certain to yield less precise results. 

Second, Brattle Group’s estimates are based on assessing a roughly 50-50 split between energy market and capacity market costs. But the report noted that recent PJM capacity market performance, with persistently low prices despite continuing new generation additions, “may suggest that capacity markets have changed in ways that could mitigate the capacity price effect found in our prior results.” 

Finally, it presumes that the lost nuclear capacity will be met by a mix comprising three-quarters natural-gas-fired power and one-quarter coal-fired power. That assumption is based on PJM’s current resource mix, but it clearly underplays the potential for wind, solar and other zero-carbon resources to take nuclear's place. 

According to Brattle Group, the four nuclear plants accounted for 39 terawatt-hours per year, far surpassing the roughly 26 terawatt-hours of all non-hydro renewable energy provided to PJM last year. 

That clean energy resource has taken more than 20 years to develop, meaning that, if all four nuclear power plants close down, “it would take less than 4 years to reverse the entire 149 million MWh of zero-emissions electricity cumulatively produced over the last two decades by solar and wind in PJM, negating billions of dollars of historical customer and taxpayer investment,” Brattle Group wrote. 

Losing all that nuclear energy would make it very difficult for clean energy to take its place, no matter how much more quickly it ends up coming online than it does today. After all, “the amount of nuclear generation that would need to be replaced is more than 15 times the current annual rate of renewable additions in PJM,” Brattle wrote. 

And replacing the zero-emission output of these four nuclear plants with zero-emission renewable generation could cost between $1.9 billion and $2.2 billion annually, Brattle predicted.

Brattle’s cost figures for new wind and solar power are based on today’s data. It uses U.S. Energy Information Agency data on levelized costs of energy for 2018 of $48.10 per megawatt-hour for wind and $57.70 per megawatt-hour for solar, excluding the value of federal tax credits. 

Brattle’s report accepts that these figures are problematic for long-term forecasting: “They are national cost averages, and since capacity factors in PJM are lower than national averages for both technologies, PJM costs would be higher than this. On the other hand, technological improvement may push renewable costs lower over time.”