U.S. Senators Introduce Nuclear Power Credit to Help Reduce Emissions

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WASHINGTON (Reuters) – Three U.S. Democratic senators on Wednesday introduced a measure to bolster existing nuclear power plants in a sweeping energy tax reform bill, after the Biden administration lobbied for such a change to help reduce carbon emissions.

The Indian Point Energy Center nuclear power plant, which New York Governor Andrew Cuomo announced as scheduled shutdown, is pictured along the east bank of the Hudson River in Buchanan, New York, United States, on April 30, 2021. REUTERS / Mike Segar

Senator Ben Cardin introduced the production tax credit amendment with his fellow Democrats, Senators Sheldon Whitehouse and Bob Casey.

“We are in danger of seeing the premature shutdown of nuclear reactors in this country,” Cardin said before introducing the amendment during a hearing on the larger bill, the Clean Energy for America Act. Cardin did not ask for a vote on the measure, a measure to allow time to refine it as the legislation advances.

The bill, Democratic Senator Ron Wyden’s long-term incentive package for clean energy and clean vehicles that removes some tax breaks for fossil fuels, was passed by the Senate Finance Committee later in the day in a party vote.

It could eventually be absorbed into infrastructure legislation, but will likely see changes. Republicans on the committee challenged cuts in fossil fuel tax incentives, saying they would hurt jobs and consumers.

Nuclear reactors are virtually emission-free, but find it difficult to compete with electricity generation powered by natural gas and wind and solar power. The United States has 93 reactors, up from 104 in 2012, as rising safety and security costs put additional pressure on the company.

As some environmental groups oppose nuclear power, the Biden administration has signaled its support for credit for nuclear power plants as it seeks to put the country on the path to decarbonizing the carbon grid from here 2035.

Two Republican senators from the Senate Finance Committee also spoke favorably of the amendment, increasing the chances that it could eventually pass.

Height Securities analysts said they believed support for risky nuclear would likely be included in the infrastructure package or other bills if strong clean energy tax provisions were included, with support from the White House and Senator Joe Manchin, a moderate Democrat.

The tax credit could help utilities like Exelon Corp keep reactors open. The company has announced it will shut down four reactors in Illinois in September and November, but is seeking incentives from the state to keep them open.

Cardin’s Amendment provides for a production tax credit of $ 15 per megawatt hour for owners or operators of nuclear power plants in states such as New York, Illinois and Pennsylvania with deregulated electricity markets . The credit would be reduced by 80% for any market income over $ 25 per megawatt hour.

The credit would start to gradually decline when greenhouse gas emissions fall 50% below 2020 levels and end entirely after 2030.

Reporting by Timothy Gardner; edited by Grant McCool and Richard Chang



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