the Beacon Journal editorial board
FirstEnergy has a proposal that state lawmakers should embrace. The Akron-based power company wants Ohio to create “zero emission credits,” or “zero emissions nuclear” credits, a program that would reflect the long-neglected value of the utility’s Davis-Besse and Perry nuclear power plants in an era of advancing climate change.
No doubt, the plan would benefit the financially ailing FirstEnergy. More important, it would preserve the operation of 2,160 megawatts of reliable, clean energy, part of ensuring a steady supply of electricity while curbing carbon emissions, the primary contributor to a warming planet. In that way, the proposal presents a test. As frequently as FirstEnergy has made itself an easy target for their criticism, environmental groups would do well to acknowledge that nuclear power is crucial given the big problem posed by climate change.
FirstEnergy faces a disadvantage in the marketplace. It relies heavily on coal and nuclear plants for generating electricity. Both struggle to compete with abundant and cheap natural gas. Thus, the company has announced its intention to get out of the competitive generation part of the business, either closing or selling its plants. It wants to focus on the regulated transmission and distribution components.
The company also proposes the option of following Illinois and New York in recognizing the value of nuclear power. The two set up something similar to the FirstEnergy nuclear credits proposal. Close a nuclear plant, and the likelihood is, it would be replaced with a natural gas facility. Natural gas burns much more cleanly compared to coal, yet it still is a fossil fuel, emitting carbon and adding to the greenhouse effect.
No surprise Illinois and New York have landed in court, critics pointing to the competitive market overseen by federal regulators. At the same time, the larger policy interest is plain. The market misses the full value of nuclear power, much as the costs of carbon emissions are not factored into the equation.
That explains why many analysts call for a carbon tax. Consider the zero emissions nuclear credits a complementary concept, making more attractive a climate-friendly approach. The same idea applies to the tax credits for wind and solar power.
Perhaps PJM, the multistate grid operator, is right about a regional approach serving better. Whatever the ultimate framework, preservation of nuclear is sound.
What would FirstEnergy get, details in its plan aiming to avoid a court fight? The proposal projects $300 million a year flowing to the company. The credit would be worth $17 per megawatt hour. It would result in an estimated 5 percent increase in customer bills, though slightly higher for industrial users. Few, if any, like price increases. Still, climate change promises its own steeper costs.
Clearly, Akron has a stake in this question, FirstEnergy employing thousands here, the company long a leading corporate citizen. Yet this is about more than the company or the town. To slow climate change requires a large contribution from nuclear power, and here is a mechanism to keep nuclear plants in operation, providing for what the market misses — their real value.