New Report Makes The Case For Why We Shouldn’t Let Nuclear Plants Shut Down


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Andrew Follett Energy and Science Reporter
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A new study on Pennsylvania’s nuclear industry paints a worrisome picture of what could be lost if reactors continues to be shut down.

The new research found that Pennsylvania’s five nuclear plants account for 15,900 in-state, high paying, full-time jobs and generate $69 million in net state tax revenues each year. The reactors keep electricity prices low, reducing Pennsylvania residents’ power bills by about $788 million annually.

“Nuclear power keeps power prices lower than they would be otherwise,” Dean Murphy, an economist who coauthored the research for an economics consulting firm called The Brattle Group, told The Daily Caller. “It’d be a huge drag for the economy if the nuclear power plants closed and those prices went up. A big part of the positive effect is that the economy multiplies the benefits of cheap power.”

America currently operates 99 nuclear reactors across 61 commercially operating nuclear power plants, according to the EIA. The average plant employs between 400 and 700 high-skilled workers, has a payroll of about $40 million and contributes $470 million to the local economy, according to the Nuclear Energy Institute. A pair of reactors The Daily Caller New Foundation visited in April shells out $22.8 million in tax revenue each year.

“Electricity is so ubiquitous that the impact is extremely widespread,” Murphy continued. “The aggregate effect on the economy is really big and positive. If we were to lose the plants, the economy would multiply the harm of more expensive power.”

Murphy noted that several of the plants are risking closure. Within the past two years, six states have shut down nuclear plants and dozens of other plants across the country are facing challenging economic conditions which places them at risk of imminent early retirement.

“Probably at least three of these plants are in economic distress,” Murphy concluded. “When they do close, it’s very bad not only for the people who work at the plant, but it’s bad for everybody else in the state and electric region. The region these plants supply power to is huge. Power prices would go up for everybody in the region. Even the waiter in the local restaurant would feel that impact through things like fewer hours.”

Much of the benefits Pennsylvania receives from nuclear power can be difficult to see, according to Murphy, as cheaper power mostly puts cash back in the hands of consumers. These consumers then spend the money on goods and services which create economic output.

“These nuclear power plants do a lot of good for the local economy,” Murphy told TheDCNF. “Some of these plants are threatened by the cheap power prices they created. Every single Pennsylvania ratepayer saves about $4 bucks a month in savings due to these nuclear plants, and that’s just the direct effect. That saved $4 bucks is spread throughout the rest of the economy, for example it means that ratepayers can spend more money going to restaurants, which is good for the waiter.”

Most analysts agree keeping residential electricity prices low is good for American households, especially impoverished ones. Pricey power disproportionately hurts poorer families and other lower-income groups as the poor tend to spend a higher proportion of their incomes on “basic needs” like power, so any increase in prices hits them the hardest.

“Generally, people with lower incomes pay a larger share of their income for necessities like power,” Murphy continued. “The price of power and other such necessities are typically regressive. The benefit of keeping the nuclear plants is better for poorer people than rich.”

As essential goods like electricity become more expensive, the cost of producing goods and services that use electricity increases, effectively raising the price of almost everything. The higher prices are ultimately paid for by consumers, especially the poor.

Murphy also noted that Pennsylvania’s nuclear plants have the serious environmental benefit of preventing roughly 37 million tons of carbon dioxide (CO2) emissions annually, which Environmental Protection Agency (EPA) figures value at $1.6 billion per year. The plants also prevent the emission of other pollutants. Nuclear power provides about 63 percent of America’s CO2 free power. A single nuclear reactor prevents about 3.1 million tons of CO2 emissions annually.

Murphy highlighted that if the state were to lose the nuclear power plants, they would likely be replaced by coal and natural gas, which would increase CO2 emissions. If the plants were actually replaced however, it could pose a threat to the stability of the power grid.

“Natural gas plants are much more flexible than nuclear power, as nuclear plants don’t turn on or off rapidly,” Murphy continued. “You can’t just shut a nuclear plant off, so they’re often effectively forced to produce power at a loss occasionally. Below zero bidding from power sources like wind and low average prices are hurting the nuclear industry. However, the power grid needs to have baseload power that only nuclear really provides. There’s a point beyond which nuclear plants can’t survive financially.”

Murphy’s report was prepared by the economics consulting firm The Brattle Group for various Pennsylvania institutions, including the Building and Construction Trades Council and Chamber of Commerce.

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