The coming demise of coal and nuclear power

Coming Coal & Nuclear Power Plant Retirements, & What That Means, Clean technica 5 May 14 (Good Graphs) “……..Some of the challenges faced by coal-fired and nuclear generators, and the implications for electricity markets if the plants are retired in significant numbers, are analyzed in this discussion………In 2012 and 2013, operators of five nuclear power reactors representing 4.2 GW of capacity announced plans to retire the reactors by 2015. Four of the reactors—San Onofre 2 and 3, Kewaunee, and Crystal River—already have ended nuclear power production, and the fifth, Vermont Yankee, is expected to end generation by the end of 2014 [1]. In addition, the Oyster Creek plant is expected to conclude operation in 2019 [2]. These are the first retirements of U.S. nuclear power plants since Millstone Unit 1 was retired in 1998. Retirements often are the result of unique circumstances, but some owners of nuclear power plants have voiced concerns about the profitability of their units, sparking discussion of possible additional nuclear retirements [3]. In order to evaluate the impacts of potential retirements beyond those in the Reference case, AEO2014 includes several alternative cases with economic assumptions that make it less likely that existing coal and nuclear power plants will be used for generation.

Factors that lead to power plant retirements

Power plant owners generally make the decision to retire plants when their expected costs exceed their expected revenues over the future life of the plants [4]. Costs incurred by power plants can include large capital projects, such as installation of flue gas desulfurization (FGD) systems or scrubbers on coal plants, increased operating costs, or higher fuel costs. Revenues are received from energy sales or capacity payments in wholesale electricity markets in regions of the country with competitive wholesale markets, or from cost-recovery mechanisms in regions with vertically integrated utilities subject to rate regulations [5].

Recent trends in the electric power industry have resulted in both declining revenues and increased operating costs for coal plants…….

When faced with declining profitability, plant owners may choose to retire their units rather than make additional investments to keep them operating. In the AEO2014 Reference case, all coal-fired plants are required to have either a scrubber or a dry sorbent injection (DSI) system combined with a fabric filter in order to continue operating in 2016 [8] and later years. As of the end of 2012, 64% of the U.S. fleet of coal-fired generators was compliant with this requirement. The remaining plant owners are in the process of deciding whether to retrofit or retire their plants [9]………

Conclusions

Accelerated retirements of coal-fired and nuclear electricity generation capacity would cause natural gas and renewables to gain an increased share in the nation’s electricity generation mix. Natural gas is most often the lowest-cost option for replacement capacity, while renewable generation grows, spurred by the increased economic competitiveness of solar and wind technologies toward the end of the projection period. The rising use of natural gas in the electric power sector results in price increases for both natural gas and electricity in all sectors relative to the Reference case http://cleantechnica.com/2014/05/05/power-plant/#S7icgLuw3MM0xsAf.99