BNEF: More than half of US nuclear plants losing money

Dive Brief:

  • New analysis from Bloomberg New Energy Finance shows the United States' nuclear sector is losing $2.9 billion annually, as plants come under pressure from cheap natural gas and increasingly-affordable renewables.
  • The analysis concludes almost three dozen of the nation’s plants are losing money — including almost all of the merchant reactors.
  • Several states have attempted to subsidize nuclear generation through a variety of mechanisms, and all have been challenged, leading to a national conversation about how to keep the non-emitting generation resources online.

Dive Insight:

The nuclear industry woes have been well covered, but now BNEF has generated some broad numbers to hang on the sector's difficulties: 

According to the report, nuclear plants receive $20/MWh to $30/MWh for their electricity while on average they're paying $35/MWh to generate it. Of the country's 61 nuclear plants, 34 are losing money, say BNEF analysts. 

New York and Illinois have both developed programs to support their nuclear generation and have been challenged, either in court or at the Federal Energy Regulator Commission, for interfering in wholesale markets. New York's zero emission credit program, aiming to keep three plants viable, is being a challenged in federal court and reviewed by federal regulators. 

New Jersey may be preparing to have this debate: PSEG President, Chairman and CEO Ralph Izzo told Utility Dive that current market structures "don't compensate nuclear plants for their very strong environmental and fuel diversity attributes." The utility has launched a campaign to educate people about energy markets and the threat to nuclear plants. 

The issue has gained greater prominence with PJM Interconnection's capacity auction results recently made public. In May, after failing to clear the auction, Exelon said it plans to close its 857-MW Three Mile Island in Pennsylvania in 2019 and take a write-off of up to $110 million.

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Filed Under: Generation