Michigan struggles to expand nuclear's role in state's energy balance

A recent Brattle Group study reports that Michigan's three nuclear power plants contribute more than $500 million to the state's gross domestic product.

This new report comes on the heels of President Barack Obama’s Clean Power Plan, which includes nuclear power as a large factor in the clean energy package. Though nuclear inclusion is welcomed by Michigan businesses, new Environmental Protection Agency (EPA) regulations on coal have created debate on how to find balance in a possible volatile energy sector.

“Michigan uses 10 percent more nuclear energy than other states, but its coal dependency is at 50 percent as well,” Jason Geer, director of Energy and Environmental Policy of the Michigan Chamber of Commerce, told Power News Wire. “With new EPA regulations, a new strategy will most definitely be needed.”

Gov. Rick Snyder has explained that the state will develop a plan to comply with the EPA's Clean Power Plan, which is considered a first attempt to regulate carbon dioxide emissions from the nation's power plants.

Geer explained there is a lot of debate over “how damaging the new EPA plans are, which will hurt businesses in Michigan,” so the study that supports nuclear energy benefits as a clean power source at least helps stay in line with the EPA’s more “unreasonable” requirements that affect Michigan workers and businesses.

Snyder earlier outlined a 10-year plan to move Michigan toward the "greenest sources of energy" and foresees renewable energy and energy efficiency measures providing 30 to 40 percent of Michigan's power needs by 2025.

"There is a discussion that is taking place in many states that have nuclear assets. It was occurring before the Clean Power Plan, but is definitely occurring now," Geer said.

Dr. Chris Douglas, chair in the Department of Economics at the University of Michigan-Flint, recently told Power News Wire that the new regulations will increase costs for consumers and businesses. One estimate he pointed to suggests that electricity rates would rise by 12 percent, or an average of $140 per year per household.

"Roughly half of the state's electricity is generated from low cost sources such as coal,” Douglas said. “The EPA regulations would phase this out and require higher cost sources of electricity to be used. Green energy is not cost-effective, and since there is no way to store the energy, it must be backed up with traditional sources of electricity for days when it is not rainy or sunny.”

Douglas further explained that “nuclear is cost effective against natural gas and coal if carbon dioxide emissions are priced at $40 per ton, as they are done in the Intergovernmental Panel on Climate Change's report, in terms of their impact on global warming. Nuclear power plants emit essentially no carbon dioxide. 

“The problem is that it takes an extremely long time to build a nuclear power plant. The last nuclear power plant built in the U.S. was the River Bend nuclear power plant in Louisiana. Construction began in 1977, but the plant didn't begin generating electricity until 1986. My guess is that it would take longer than 10 years to build a new nuclear power plant today."