Despite America’s abundance of natural gas from shale production, some parts of the country have already had warnings that over-dependence on gas for electricity generation exposes consumers to soaring prices for electricity, writes Mark Perry in the Investor’s Business Daily of January 16, 2014.
The problem is the declining use of coal and nuclear power, the two sources of electricity that provide the greatest price stability and serve as a hedge against wide fluctuations in gas prices, according to Perry, a professor of economics at the Flint campus of the University of Michigan and a resident scholar at the American Enterprise Institute.
Among his comments:
For the power industry to become increasingly dependent on a fuel with a history of price volatility could be problematic. Nationally, since 1995, the United States has built 342,000 megawatts of gas-fired power capacity, approximately 75% of all capacity additions. But coal and nuclear power account for only 6% of the total.
Long-term energy fundamentals support continued reliance on and expansion of nuclear power.
Nuclear plants supply large amounts of carbon-free energy around the clock, safely and reliably. Nuclear plants provide forward price stability and are not subject to the volatility of natural gas prices. And they contribute to the fuel and technology diversity that is the bedrock of a resilient electric sector.
These are among the economic and environmental values of nuclear power, but they are values that the public does not recognize. A nuclear plant is an asset with a 60-year lifetime that is carbon-free and doesn’t pollute the air. And, unlike solar and wind power, it is always on.
For the better part of a half-century, America has benefitted from a balanced energy program that has included nuclear power. Today our energy system is the world’s best, but that doesn’t mean we can let up.
For clean base-load power, we will need nuclear energy. And that’s why it’s important to craft policies that open up private investment in new nuclear plants. Georgia’s Plant Vogtle is currently undergoing an expansion, adding two reactors. Read Benita Dodd’s 2012 commentary, “Don’t hide energy innovation under a bushel.”