Jobs, environment speak to need to protect nuclear power

Springfield is buzzing with hearings and lobbying efforts on the future of energy in Illinois, spurred by the recent introduction of two bills in the Illinois legislature and ongoing Federal attempts to curtail greenhouse gas emissions.

These developments plus pressure of public opinion to fight global warming, give Illinois little choice but to seek greater reliance on fuels with low carbon emissions.

One of the Illinois bills, the Low Carbon Portfolio Standard (LCPS), aims to curtail greenhouse gas emissions at least cost. The bill recognizes the contribution of nuclear power to reducing greenhouse gas emissions.

It is buttressed by studies of state agencies pointing to significant Illinois job losses if three nuclear plants are allowed to close that Exelon has indicated are unprofitable.

The nuclear plant losses are due to changing energy prices connected mainly with natural gas fracking. At present, nuclear plants receive no credit for reducing greenhouse gas emissions, while wind and solar renewable energy sources receive large subsidies.

The second bill, Renewable Resource Procurement (RRP) sponsored by the Illinois Clean Jobs Coalition, proposes to fight greenhouse gas emissions through greater reliance on renewables, limited principally to wind and solar power generation, as well as energy conservation measures, but excluding nuclear power.

The legislative choice posed in the two bills boils down to whether Illinois will transition to greater reliance on fuels with lower greenhouse gas emissions with or without the help of nuclear energy.

A major consideration is jobs in Illinois. If the plants are allowed to close, the transition to greater reliance on renewable energy will take place without the help of nuclear energy. The job impacts will be large and immediate.

The Illinois Department of Commerce and Economic Opportunity has estimated that nearly 8,000 jobs would be lost, accompanied by $1.8 billion per year in reduced economic activity in Illinois.

These losses would be prevented if the LCPS is passed. On the other hand, if the nuclear plants are allowed to close, the transition will take place without nuclear power's help.

An existing electricity source with no greenhouse gas emissions (nuclear) will immediately be replaced largely with sources having greenhouse gas emissions (coal and gas).

In addition to jobs, system reliability is an issue. Utilities must be able to keep power available to customers in the face of uncertain demands. An analysis by ComEd's system operator PJM concludes that costly new transmission upgrades would be required to satisfy reliability standards if the nuclear plants close.

Another consideration is the price of electricity. An accepted part of energy policy is that global warming and environmental benefits justify the extra cost of reducing carbon emissions, providing all the more reason to seek the lowest cost solutions.

The LCPS, allowing the plants to remain open, contains a competitive bidding process that would help minimize costs.

Bidders will have incentives to offer their lowest prices, favoring an efficient and cost-effective solution for consumers. Mandating that consumers purchase large amounts of energy generated from inefficient and unreliable sources will lead to greater costs.

Renewable energy has a place and over time can grow, but the additional costs of aggressive development of expensive and unreliable energy should not be forced on consumers and taxpayers when reliable carbon-free electricity is readily available.

The competitive bidding process will contribute to economic development. In addition to avoiding job losses, the need to confront serious economic problems of the state makes steps to encourage positive job development in Illinois all the more important.

Keeping energy costs low is vitally important to economic development and the Illinois economy.

What should Illinois do? The case for immediate legislative action allowing continued operation of the nuclear plants wins on all the above counts.

George S. Tolley, Ph.D., is president of RCF Economic & Financial Consulting Inc. and professor emeritus of economics at the University of Chicago.