President Obama may be pressing for the nation to increase its supply of nuclear power, but the market is pushing in the opposite direction.
President Obama may be pressing for the nation to increase its supply of nuclear power, but the market is pushing in the opposite direction—at least in the view of one of the leading figures in the U.S. nuclear business.
John Rowe, chief executive of Chicago-based Exelon, operator of the nation’s largest fleet of nuclear power stations, says the economics of the electricity business have changed sharply in just the past two years, dimming the prospects for a significant number of new nuclear reactors in the United States.
Though Obama has touted nuclear as “our largest source of fuel that produces no carbon emissions,” cleanliness is not a benefit that currently shows up on the bottom line. Without congressional action to make competing fuels that emit greenhouse gases more expensive, Rowe says, fossil fuel plants are still cheaper to build. “I just don’t think nuclear has a chance in a pure marketplace without a carbon price,” Rowe said last week in Washington, D.C., in a speech hosted by Resources for the Future, a think tank focused on cost-benefit analysis in environmental policy.
While Rowe noted that some companies are still working on nuclear projects, he pointed out that they tend to be in “rate-based jurisdictions.” In other words, they are in traditionally regulated states where monopoly power companies can sometimes recoup the costs of building nuclear plants during construction through the rates they charge their customers.
Exelon, in contrast, operates only in states where deregulation has created competitive markets. In effect, it sells the power it produces into the electricity marketplace. And because electricity prices have dropped—particularly due to new, abundant supplies of natural gas—Rowe thinks that building new nuclear plants does not make economic sense now.
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Source: National Geographic News
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