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Subsidies and Taxes Complicate the Future of Nuclear Power
Posted By Robert Geringer On August 7, 2013 @ 5:00 pm In Energy | Comments Disabled
Rising maintenance costs and a sharp decrease in natural gas prices have put the future of some nuclear power plants into question. But other plants face retirement under the burden of specific taxes and anti-competitive green energy subsidies.
Mark Cooper, a senior fellow at the Vermont Law School, recently published a report  identifying the problems facing America’s fleet of nuclear reactors. Forced to compete with coal and natural gas in deregulated electricity markets, some nuclear power plants struggle to keep pace.
The Kewaunee Nuclear Power Station in Wisconsin closed last year  on economic grounds, and Cooper thinks that Kewaunee could be the “figurative canary in the coal mine,” forecasting future closings. Faced with rising maintenance costs and looming safety upgrades mandated after the 2011 Fukushima accident in Japan, some nuclear power plants have lost their competitive edge.
Is this an indication that nuclear power is uneconomic? Not necessarily. Cooper’s list includes three reactors which face closure under the burden of bad energy policy:
The bottom line is simple: Government interference in electricity production kills jobs and increases electricity prices for American families. Anti-competitive subsidies meant to cut CO2 emissions might accomplish the exact opposite if they shut down nuclear power plants, which generate 64 percent of the nation’s carbon-free electricity .
It’s not the government’s job to pick energy’s winners and losers; as made clear by Kewaunee, the market does an effective job of that already.
Robert Geringer is currently a member of the Young Leaders Program at The Heritage Foundation. For more information on interning at Heritage, please click here .
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URL to article: http://blog.heritage.org/2013/08/07/subsidies-and-taxes-complicate-nuclear-power-s-future/
URLs in this post:
 Image: http://blog.heritage.org/wp-content/uploads/nuclear-plans.jpg
 report: http://184.108.40.206/071713%20VLS%20Cooper%20at%20risk%20reactor%20report%20FINAL1.pdf
 closed last year: http://www.nytimes.com/2013/05/08/business/energy-environment/kewaunee-nuclear-power-plant-shuts-down.html?_r=0
 and generates 65 percent of Vermont’s electricity: http://www.eia.gov/state/seds/sep_sum/html/pdf/sum_btu_eu.pdf
 increased by more than a factor of 10: http://www.leg.state.vt.us/jfo/issue_briefs_and_memos/Vermont%20Yankee%20UPDATE%2002-2011.pdf
 2011 Connecticut Electric Generation Tax: http://www.ct.gov/drs/lib/drs/publications/pubssn/2011/sn2011-11.pdf
 struggling to compete with anti-competitive wind subsidies: http://dailycaller.com/2013/02/08/wind-subsidies-threaten-to-shut-down-nuclear-plants-warns-energy-exec/
 wind producers can pay the grid to take their electricity: http://www.midwestenergynews.com/2013/06/13/exelon-blames-subsidized-wind-markets-for-derailing-nuclear-projects/
 64 percent of the nation’s carbon-free electricity: http://www.eia.gov/totalenergy/data/annual/pdf/aer.pdf
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