The fate of nuclear energy in the US is being decided, in part, by the Supreme Court’s decision to ratify President Obama’s Clean Power Plain (CPP) as well as states’ legislation to preserve a dying nuclear industry through subsidisation and accommodating policies.
For Energy Intelligence, S&P Global Rating’s Michael Ferguson discusses why nuclear energy will become an increasingly valuable asset to states should new federal carbon standards be introduced. This is because nuclear is the only energy source that can be produced on a base-load scale that is carbon free.
However, Ferguson notes that nuclear generation has become quickly unprofitable competing against low gas prices since the shale gas boom. Additionally, renewable energy sources have been given priority on energy grids, also contributing to a lesser demand for nuclear energy production.
For nuclear to survive, its profitability will need to be heightened through carbon regulation and a decline in gas and coal production. However, it may take several years for this to happen. In the meantime, Ferguson argues, it is up to states to support their nuclear assets to see their profitability rise in the future.
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