The Millstone Power Station supplies more than 90 percent of the carbon-free electricity generated in Connecticut, and in fact is the largest carbon-free generator in all of New England. That’s just one reason why allowing Millstone to close prematurely would be a mistake.
The Connecticut legislature is considering a proposal that will help avoid that ill-advised and costly closure by allowing carbon-free electricity from the Millstone nuclear power plant to be sold in auctions that are currently carved out for electricity generated by wind, solar, and even Canadian hydro. As a native New Englander who ran the U.S. Department of Energy’s nuclear energy program under President Obama, I’ve followed this issue closely. Let me offer some perspective on the important issues at hand.
First is the environment. Nuclear power is by far our nation’s largest source of carbon-free electricity. However, since there is no meaningful price on carbon emissions, electricity companies that burn fossil fuels like coal and natural gas pay next to nothing to dump their carbon emissions in our atmosphere. The lack of a national price on carbon, coupled with dramatically reduced drilling costs made possible by fracking, have driven the price of electricity down to the point where clean technologies like nuclear could be priced out of the market.
That’s one reason why states like Connecticut have acted to ensure carbon-free technologies like wind and solar are part of the mix. The same should be done for nuclear, because if the Millstone plant is allowed to close down, fossil fuels will fill nearly all of the gap and carbon emissions will go up. By a lot. Like more than all of the automobiles in Connecticut.
The second issue is electricity prices. Some groups have speculated that allowing Millstone to compete against other carbon-free generation will result in increased electricity prices. I’d rather stick to the facts. What we know for sure is that closing down Millstone will raise electricity prices, compared to the case if the plant remains in operation.
How can that be? It’s because of the way electricity markets work. The details are arcane, but the bottom line is that nuclear plants are known as “price-takers,” needing to accept whatever price it takes to clear the electricity market. When price-takers exit an electricity market, the clearing price goes up. Always. And when the clearing price goes up, the cost to consumers goes up. When the state of New York decided last year to save several of its nuclear plants, it found that doing so will save consumers about a billion dollars a year. Preserving Millstone will offer similar benefits for Connecticut.
The final issue is jobs, and it’s an important one. Millstone directly employs more than 1,400 people and supports a total of nearly 4,000 jobs in-state. The plant’s annual payroll is nearly $100 million. Operation of Millstone produces about $1.5 billion in annual economic benefits to Connecticut. If the plant closes, those jobs will be exported to other states, and more natural gas pipelines or transmission lines will be built to get the needed energy into Connecticut. The state will see yet another major employer exit the scene, and carbon emissions increase.
Fossil fuel interests will argue that Connecticut doesn’t need to act to save Millstone because the federal government will take care of the issue. Right. As my mother likes to say, “I was born at night but not last night.” The proposal before the Connecticut legislature will save jobs, hold down electricity prices, and reduce carbon emissions, all without depending on a miracle to occur in Washington, DC. The state should act now and pass SB-1501 for a stronger economy, lower prices and a cleaner energy future.
John Kotek is Vice President of the Nuclear Energy Institute. He led the U.S. Department of Energy’s Office of Nuclear Energy from 2015-2017, served on the staff of Sen. Jeff Bingaman (D-NM), and held management positions with DOE-Idaho and Argonne National Laboratory.