Autumn is here, bringing good news: the Washington Nationals are in the MLB playoffs. But more importantly, the discussions about nuclear power in our future energy portfolio continue to gather steam (pun totally intended).
It’s refreshing to see so many prominent organizations speak out on behalf of nuclear. We also have seen more states identify nuclear power as a path to achieve their carbon goals. The point is clear: if we want deep and rapid decarbonization, we need nuclear.
As policymakers, climate advocates and thought leaders look to value nuclear, though, the onus is back on the industry to show what we are doing to stay competitive.
So, with baseball clearly on my mind, I ask, “Has the nuclear industry stepped up to the plate?”
Let’s dive into the details. According to NEI’s recent report, “Nuclear Costs in Context,” the average total generating cost for nuclear energy in 2018 was $31.88 per megawatt-hour, 7.1 percent lower than in 2017 and nearly 25 percent below peak costs in 2012. In simple terms, a unit of nuclear electricity generation is 25 percent cheaper than it was just seven years ago.
According to the U.S. Energy Information Administration, the average cost of electricity (which includes other sources of electricity, such as renewables, natural gas and coal) has increased by 7.5 percent during the same time.
What’s driving this reduction in costs?
Total generating costs include capital, fuel and operations costs—all the costs necessary to produce electricity from a nuclear power plant. The 25 percent reduction overall is due to a 46 percent reduction in capital expenditures, a 25 percent reduction in fuel and a 14 percent reduction in operations costs. The operations costs have actually reduced to 2004 levels, a feat in itself.
You might assume that the reduction is because nuclear power plants are running less or at lower power levels. But that’s not the case.
The nuclear industry achieved its highest average capacity factor ever at 92.3 percent. Capacity factor is a good indication of how efficient the plants are because it is calculated by taking the actual amount of electricity generated compared to the maximum amount of electricity that could have been generated.
Nuclear power plants have high capacity factors because they can run at 100 percent power for 18 to 24 months between refueling outages, providing carbon-free and baseload electricity. According to the U.S. Energy Information Administration, the nuclear industry generated over 807 million megawatt-hours in 2018, the highest amount it’s ever generated.
Nuclear is breaking its own records, all while employing nearly 100,000 people. These employees also earn on average 20 percent higher than the overall electricity generation industry.
You might wonder if this is the case, why are nuclear plants in jeopardy of closing? That’s due to flawed markets that don’t value the full benefits that nuclear provides, like carbon-free generation and reliability. Many states—including New York, Illinois, Connecticut and New Jersey—have moved to address these flaws, but more must follow their lead.
It’s evident that the nuclear industry has stepped up to the plate. In fact, America’s nuclear plants have been performing so well, they could join the Nationals in the playoffs. We need clean energy policies that will protect the climate by properly valuing the largest clean energy source in the United States.
