EPA’s McCarthy Says Carbon Emissions Rules Will Boost Nuclear

Environmental Protection Agency (EPA) head Gina McCarthy said on Tuesday that the agency’s proposed carbon emissions rules are specifically designed to support nuclear plants that are struggling with profitability.

In Chicago to campaign for support from business leaders, McCarthy said the agency has focused on about 6% of the nation’s nuclear fleet that is in danger of premature closure because of difficulties in competing with lower-cost gas-fired generation and subsidized renewables. The location for the remarks was significant because Chicago-based Exelon Corp., which operates the largest fleet of nuclear plants in the U.S., has said repeatedly that several of its plants may need to shut down on profitability concerns.

The administration’s “Clean Power Plan” aims for a nationwide 30% reduction in CO2 emissions from 2005 levels. Each state has a different goal, some of which vary widely, a quirk that has resulted in substantial confusion and discussion.

Exelon CEO Chris Crane has called several times for policy changes to support nuclear profitability, highlighting what he sees as an unequal and unfair playing field for nuclear, something that could endanger efforts to reduce carbon emissions. Exelon has lobbied the Illinois state government for supportive measures, though so far nothing has been done.

McCarthy said the EPA is concerned about premature nuclear shutdowns, and the new rules are designed to provide support. Boosting carbon-free generation is one of the plan’s key building blocks. Illinois’s carbon reduction goal is 33% from 2012 levels, which means it would provide an incentive to support Exelon’s plants.

It is highly uncertain when the rules might be final and in what form, given the certainty of litigation and possible Congressional action to block or impede EPA enforcement.

—Thomas W. Overton, JD is a POWER associate editor