New York approved a $7.6-$10 billion subsidy to prop up uncompetitive nuclear power plants–twice as much money as it will take for the state to achieve a goal to generate 50% of its electricity with renewables by 2030.
Yesterday, New York became the first state to adopt a policy to subsidize aging, uncompetitive nuclear reactors. The state’s Public Service Commission, which regulates utility companies, passed a Clean Energy Standard that combines a 50% renewable energy standard by 2030 with massive subsidies to prop up uneconomical reactors. (You can download the whole PSC order here.)
Prepare yourself for loud celebrations from the nuclear industry, heaping praise on New York Governor Andrew Cuomo and calling for other states to emulate the Empire State with lucrative incentives to insulate the nuclear industry from competition and to postpone closures of uneconomical reactors.
We hate to throw water on the parade, but the move actually proves what a bad idea it is to throw subsidies at nuclear power. Let’s jump to the punch line, then we can fill in the blanks: New York just committed to spending twice as much money propping up old nuclear reactors than on new renewable energy, to get 2-3 times less energy from nuclear as renewables in the end.
Spend more, get less electricity, get more carbon emissions–and get a lot of radioactive waste.
Basically all of the $7.6 billion in nuclear subsidies will leave New Yorkers’ bank accounts and go to companies headquartered in Chicago and Paris: Exelon and Electricite de France, which jointly own the company that will own all of the bailed-out reactors. The money will produce not one more job for unemployed New Yorkers, put not one more solar panel on a roof, provide not one more dollar of economic development. And by soaking up so much of New Yorkers’ energy dollars, the subsidies could prevent them from investing in energy efficiency and renewables.
There is going to be a lot of pain—economic, human, and environmental—for no real gain, and possibly a lot of political blowback for Governor Cuomo in the next election. Power bill hikes will start in May, 2017, as New Yorkers get hit with $480 million per year in surcharges for nuclear power.
Incentive proposals for existing reactors have been debated in Illinois and Ohio since 2014, and cropped up in Connecticut, New Jersey and Pennsylvania this year. However, pumping hundreds of millions of dollars a year into supporting aging reactors–most of which are supposed to be in competitive energy markets–has had difficulty gaining traction, resulting in Exelon’s announcement in June that it will close the Clinton and Quad Cities 1 and 2 reactors in Illinois.
Nuclear boosters will argue that New York is setting a precedent for other states to prop up the industry by “valuing” nuclear power’s role in combating climate change. But to those close paying attention, it proves just the opposite: bailing out aging, uneconomical reactors is a massive diversion of time and money needed to invest in renewable energy, …read more