EIA reports that in late July 2019, Ohio became the fifth state in the United States to enact policies that provide for compensation or other assistance for in-state nuclear generating plants. Connecticut, Illinois, New Jersey, and New York have implemented similar support programs for some of their nuclear power plants since 2017. All five state states have unbundled, retail-choice electricity markets where generators do not receive cost recovery from state regulatory commissions. Nuclear power is a significant source of in-state electricity generation in each of these five states.
Collectively, the 14 reactors at the 10 plants receiving state support account for 9% of the utility-scale generating capacity in those five states and 13% of the nation’s nuclear generating capacity. Because nuclear power plants tend to operate at higher capacity factors than other generator types, these plants’ shares of their states’ or the national electricity generation is larger than their shares of capacity.
Declining prices for electric power in wholesale markets have placed economic pressures on many nuclear power plants in the United States and led to several plant closures. Eight nuclear power plants have retired since 2013. The Three Mile Island nuclear power plant in Pennsylvania closed at the end of September, and another five U.S. reactors are scheduled to retire by the end of 2025. In states with more traditional state-regulated power markets, the cost of electricity generation is regulated by state commissions, which can offer power plants protection from rising costs. In states with retail choice, plant owners generally do not have that protection, and some owners have indicated that they are unable to recover all costs of operation in today’s relatively low-price wholesale market. The support programs for nuclear power in the five states allow the owners to make up for unrecovered costs, which are usually funded by surcharges to electricity customers or by permission to participate in clean energy markets previously restricted to renewables.
Original working URL: https://www.eia.gov/todayinenergy/detail.php?id=41534
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