By Christine Todd Whitman
May 9, 2012
Today’s natural gas market is still vulnerable. We should take advantage of our domestic energy resources, including nuclear energy.
Don’t overlook nuclear.
FORTUNE — The United States needs an “all of the above” energy strategy that focuses on low-carbon electricity sources that will lower energy costs, reduce dependency on foreign fuel sources and promote clean electricity. This is a prudent strategy to help drive American manufacturing and transportation networks of the future. Most importantly, this approach can put the country on a sustainable path toward long-term economic growth.
While today’s rock-bottom natural gas prices are attractive, an unbalanced dependence on natural gas in the electricity sector would put Americans at risk, both economically and in terms of longer term energy security.
While many look at energy prices from today’s lens, successful energy policy requires a long view that promotes fuel diversity but doesn’t pick technology winners; it preserves our air, land and water and is affordable for consumers.
We need only look at the volatile history of natural gas prices. Consider the shift from the low, stable prices of the 1990s to the record-high rates and wild supply fluctuations of the mid-2000s.
We should take advantage of our domestic energy resources, recognizing that today’s natural gas market is still vulnerable. The present oversupply of natural gas opens opportunities for exports into foreign markets at prices two-to-three times higher. If demand from other countries increases as they meet growing energy demand, it will cause our prices to align with higher world prices.
During my tenure as governor of a state that relies heavily on nuclear energy, I can attest to the cost effectiveness of nuclear fuel and the protection it offers against price spikes in natural gas or future environmental controls such as a cost on carbon. Nuclear energy doesn’t emit any greenhouse gases or controlled pollutants while producing power and it is affordable, predictable and efficient. Moreover, a nuclear power plant with a footprint of one square mile generates the same amount of energy as 20 square miles of solar panels or 2,400 wind turbines spread out across 235 square miles.
Uranium fuel is abundant and costs an average of 2.14 cents per kilowatt-hour, compared to 4.86 cents per kilowatt-hour for natural gas. A nuclear plant typically generates electricity at 90 percent capacity—an electric sector best and twice that of combined cycle natural gas plants at 40 to 45 percent capacity.
Clean energy production costs, which include fuel, operations and maintenance, run nearly equal for nuclear and natural gas. A new nuclear plant with state or federal support can generate power at $84-$91 per megawatt-hour with zero carbon emissions. Natural gas plants produce power at today’s gas prices for $56-$71 per megawatt-hour, but still emit greenhouse gases at about half the rate of coal plants. Assuming a carbon price of $30 per ton, natural gas power generation costs rise to about $74-$89 per megawatt-hour.
At Fortune’s Brainstorm Green conference, I noted a March 2012 Gallup poll that found 57% of Americans support nuclear energy.
This support reflects the momentum behind nuclear energy’s expansion, including recent U.S. Nuclear Regulatory Commission approval of four reactors in Georgia and South Carolina.
New large-scale electricity is needed today in the fast-growing Southeast electric grid because of business expansion and population growth. These new reactors will serve the needs of 3 million homes while creating thousands of high-paying jobs. On average, a nuclear facility creates up to 3,500 construction jobs and 400 to 700 operation positions.
According to the Bureau of Labor Statistics, nuclear energy accounted for 54% of green jobs in the utility sector in 2010, supplying the most green goods-and-services jobs—35,800—in private sector electricity generation. For example, 90% of the components for the Westinghouse reactors being built in Georgia and South Carolina will be manufactured domestically.
As the dash to gas accelerates across America, I am encouraged by the support from government and industry leaders for nuclear energy as part of a diverse electricity supply. Secretary of Energy Steven Chu recently restated the administration’s support for nuclear energy to be developed alongside renewable energy sources and natural gas. Kevin Marsh, president and CEO of Columbia, S.C.-based SCANA, which is developing two advanced designed Westinghouse reactors, said a balanced energy portfolio is best. “You don’t want to be all gas, all nuclear or all coal.”
Fuel diversity is one of the great strengths of the United States’ electric supply system, and we must be mindful of that lesson. In the coming years, we will need hundreds of new power plants from a variety of fuel sources along with significant investment in the smart grid that will move that power to homes, businesses and an evolving electrified transportation system. Nuclear energy is the only large-scale, carbon-free electricity source, and it must be among these energy choices if we are to secure a safe and sustainable portfolio of energy resources.
Christine Todd Whitman, former EPA administrator and New Jersey governor, is the co-chair of the Clean and Safe Energy Coalition which promotes the inclusion of nuclear power as part of a clean energy portfolio. She spoke on two panels at FORTUNE Brainstorm Green focused on “The Future of Fuel” and “Clean Energy Under Fire.”