Nuclear Power Credit to Curb Emissions Introduced by U.S Senators
May 28, 2021
Over the past decade there has been a big push to shut down nuclear power plants given rising costs, preference for renewables, and negative public sentiment. According to the Energy Information Administration (E.I.A), nuclear energy is the cleanest energy source in the United States, accounting for 55% of all emission-free electricity, and more carbon-free generation than all other sources combined. It is expected these assets are necessary to achieve the goal of de-carbonizing the grid by 2035, and push toward electrification.
This week three U.S senators introduced a measure to give existing nuclear plants tax credits to prevent premature shutdowns as more renewables are built. The package is designed to provide long term incentives to keep nuclear plants operating and remove some incentives from the aging fossil fuel industry. It provides a production tax credit of $15/MWh for existing plants in deregulated markets which is reduced by 80% for any revenues above $25/MWh, and phase down when GHG emissions fall by 50% below current levels. As renewables are being built and fossil fuel plants are taken offline, reactors can serve as a baseload while proper storage technologies are implemented.