Gary Wolfram

Nuclear power accounts for more than 60 percent of the nation’s carbon-free energy, but in the past few months, due to an abundance of low-cost natural gas, utilities have announced plans to shut down six safe and efficient nuclear plants. And many other plants are at high risk of early retirement.

Nationally, and in Michigan, there has been growing concern about carbon emissions and how to address the issue. While the focus has been on “renewable sources” such as emission-free solar and wind power, it is important to remember that nuclear power is not only nonpolluting but reliable, supplying electricity around the clock. In Michigan, three nuclear plants produce 26 percent of the state’s electricity. It is important to think about how to coordinate the expansion of solar and wind power with the U.S. fleet of nuclear plants.

A problem is that nuclear power has a high fixed cost so it is economically susceptible to sudden drops in the price of electricity. The recent drop in the price of natural gas has put some plants, in particular those in New York and California, in danger of shutting down. This is causing stress on the power grid. It also increases the amount of carbon emissions, as this power will be replaced at least in the near future with natural gas-fired plants.

What’s adding to the problem is the intermittency of solar and wind power. Neither is of value on days when the sun isn’t shining and the wind isn’t blowing. As the amount of power generated by these intermittent sources expands the grid will require more advanced energy storage in the long term and the ability of base line power plants to ramp up and reduce power in the short term.

So as greater use is made of renewable energy sources, nuclear power’s economic problems will grow. Because nuclear plants are not capable at this time of varying production in response to changes in the supply of renewable power, they will be selling wholesale power at reduced rates during peak solar and wind generation. These rates may not be sufficient to cover fixed costs and allow nuclear plants to stay in business.

In California, Pacific Gas and Electric (PG&E) has announced plans to close the state’s last nuclear power plant at Diablo Canyon by 2025. PG&E plans to replace Diablo Canyon’s power with increased development of wind and solar power, but this will clearly not reduce the total amount of carbon emissions since one zero-carbon source of electricity will be displacing another.

It is possible that California may end up in the long run with no net increase in carbon emissions, but this might be due to the fact that California’s climate allows for greater generation of solar and wind power. Nuclear power provides only 9 percent of the state’s electricity.

New York, on the other hand, has chosen to support its nuclear power industry — and do so in a way that would result in a reduction in carbon emissions. New York has adopted a mandate to reach 50 percent renewable energy production by 2030. But the state is concerned about the effect this transition would have on its nuclear power facilities, which produce 30 percent of the state’s electricity.

Three New York nuclear plants are in danger of closing prematurely and estimates are that this would add significantly to carbon emissions with attendant costs. As a consequence, during its drive to reach 50 percent renewable energy, New York will subsidize its nuclear power in order to keep the reactors from closing.

Michigan should be aware of the interconnection between increased renewable energy and nuclear power as both are carbon free. New York and California have chosen diametrically different paths and it is quite possible that policy makers in Michigan will find a third way.

Gary Wolfram is William Simon professor of economics at Hillsdale College.