Duke Energy seeks to replace coal plant with new nuclear power, a win for American Experiment and John Locke Foundation
Duke Energy recently made a smart announcement outlining plans to replace one of the company’s coal-fired power plants with new small modular reactors at the Belews Creek Steam Station. In doing so, Duke is taking a “replace the existing coal plants with nuclear before retiring them” approach to ensure reliability is maintained or improved as required by HB 951.
This is the exact strategy American Experiment and the John Locke Foundation have suggested for North Carolina and Duke Energy over the last three years, and it is a major win for our organizations.
In addition to modeling the impact of energy policies in the Midwest, American Experiment has been very active in North Carolina, helping the John Locke Foundation write three reports on energy policy in the state.
Among these reports was our analysis of Duke Energy’s Carbon Plans, a report in which the utility laid out four different ways to reduce its carbon dioxide emissions in compliance with the state’s 100 percent carbon-free mandate, HB 951. Our modeling found the plans that relied heavily on wind and solar would be expensive and result in capacity shortfalls, i.e., rolling blackouts.
We also presented an alternative plan, which we called the “Least Cost Decarbonization” scenario, that relied extensively on the idea that existing coal plants should not be retired until there is a suitable, reliable nuclear plant built to replace them, as we wrote in our 2022 report:
The LCD [scenario] would utilize existing coal plants to mitigate rising natural gas prices and keep these units online until the mid-2030s, when new nuclear power plants would be brought online to replace them. This strategy is consistent with the letter — and the spirit — of HB 951, which seeks to optimize low costs and reliability by providing flexibility on the timeline for coal unit retirements.40 This approach would also minimize fuel supply risks for natural gas, which could be constrained by a lack of pipeline capacity.
Gradually replacing coal plants with new nuclear facilities will save hundreds of billions of dollars compared to attempting to replace them with wind, solar, and battery storage and provide a superior reliability value to North Carolinians.
Xcel Energy should be taking Duke’s approach in Minnesota, but the company is foolishly planning to shut down Sherco 2, a 680 MW coal-fired power plant in Becker, at the end of this year. Instead of planning to replace this capacity with new nuclear, Xcel hopes to replace it with solar panels and expensive battery pilot projects.
Duke Energy should be applauded for coming to its senses on nuclear power. Hopefully, Minnesota utilities will wise up soon.