The Trump Administration continues to attempt to keep expensive coal and nuclear power plants online, a move that could cost US taxpayers up to $35 billion a year. That’s despite these energy sources providing no clear advantage over clean energy alternatives like wind, solar and natural gas, for the US electric grid.
That’s according to a new study by The Brattle Group conducted on behalf of a wide range of clean energy industry associations led by Advanced Energy Economy (AEE). The report looked at a range of ways that the Trump Administration could force US taxpayers to pay more for energy from these uneconomic energy sources.
The report assessed three scenarios for shoring up these power plants. The least costly option would give them uniform support in terms of dollars per unit of capacity. That would cost taxpayers roughly $9.7 billion a year. Impacted power plants could be paid $50 per kilowatt of generating capacity under such a scenario, for instance.
If power plant owners that are now facing shortfalls were given payments to cover their losses it would cost taxpayers between $9.7 billion and $17.2 billion a year. The most costly option would grant plant owners a return on their invested capital and pay for operating shortfalls. That approach, Brattle concluded would cost US taxpayers between $20 billion and $35 billion a year.
“Giving aging power plants that are not needed to keep the lights on $34 billion just to exist—that’s money for nothing,” asserted Malcolm Woolf, AEE Senior Vice President of Policy. “It’s too high a price to pay when advanced energy resources and competitive markets can provide the necessary services to keep our grid affordable, reliable, and secure. Independent assessments confirm that these power plants—most of which are decades old—are not needed to ensure reliability or security. We urge the Trump Administration to abandon, and Congress to resist, this exercise in crony capitalism, which comes at the expense of American businesses, families, and economy.”
The report noted that there are still uncertainties as what the Trump Administration will do and how that will impact costs. The report doesn’t discuss in detail emissions impacts. But it concluded. “Arresting the retirement of uneconomic generating assets in the current market environment will likely prove quite costly.”
“This report clearly shows that proposals to prop up coal and nuclear resources will needlessly raise the cost of electricity and hamstring U.S. manufacturers to compete in increasingly competitive domestic and international markets. I fear, however, the impact is underestimated and that the actual impact on consumers will be worse,” contended John Hughes, President of the Electricity Consumers Resources Council President and CEO (ELCON).
Other organizations involved in supporting the Brattle report included the American Petroleum Institute (API), American Wind Energy Association AWEA), Electric Power Supply Association (EPSA), and the Natural Gas Supply Association (NGSA).Tweet