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Five US states have introduced support measures for nuclear power plants

9 Oct 2019

According to the US  Energy Information Administration (EIA), nuclear power generation has been facing an increasing pressure due to declining prices in wholesale power markets, leading several nuclear plants to close: eight nuclear plants have retired since 2013, the Three Mile Island power plant shut down in late September 2019 and another five reactors are expected to stop by the end of 2025. Consequently, five US states have implemented policies to support nuclear power plants, namely New York, Illinois, Connecticut, New Jersey and Ohio. Ohio was the latest state to enact policies providing for compensation or other assistance for in-state nuclear power plants in July 2019.

These five states have unbundled, retail-choice electricity markets, where the cost of electricity generation is not regulated by state commissions and where nuclear power plant owners don't receive cost recovery from state regulatory commissions. The support measures in the five states allow nuclear power generators to make up for unrecovered costs that are usually financed by surcharges to electricity customers or by allowing nuclear plants to take part in clean energy markets initially planned for renewables. Most support programmes include zero emission credits (ZECs) that power utilities must buy from nuclear generators; they range between US$10/MWh and US$17.5/MWh in Illinois, New York, New Jersey, and Ohio. In Connecticut, the Millstone nuclear power plant is allowed to participate in a CO2-free power auction: in 2018, nearly half of the power plant's capacity cleared that auction and signed a power purchase agreement (PPA) with an in-state utility.

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