A $7 billion project that will send wind power from remote areas in West Texas to Dallas, Houston and other big cities is on the verge of completion, and that could pound yet another nail into the coffin for U.S. nuclear power and, for that matter, coal. The new Texas wind power project was authorized by the state’s Public Utility Commission (PUC) in 2008. When completed some time this year it will include 3,500 miles of new line carrying up to 18,456 megawatts, and according to a trade news report, PUC is already looking to order more wind power transmission lines, apparently with connections to out of state markets.
The question is, does this really mean that nuclear and coal power are on the way out?
Texas Wind Power Up, Nukes Down
Well yes, eventually, according to Christopher Crane, the CEO of energy giant Exelon. In an interview with the Chicago Tribune last week, Crane predicted that the influx of low cost wind power would lead the company to start shuttering its nuclear plants.
That’s no idle conjecture (or threat, as the case may be). Direct costs and risk management issues are already casting a shadow over the nuclear industry in Texas.
In 2011, rival utility giant NRG was set to build two new power plants in Texas but backed off as a wind power surplus combined with a stiffer regulatory environment for nuclear power, consequent on the Fukushima nuclear disaster.
The U.S. market isn’t the only place where nuclear energy is getting a chilly reception due to cost and safety concerns. The U.K.’s ambitious plan to build 10 new nuclear power plants just lost the backing of British utility Centrica, which is apparently going to concentrate its resources on renewable energy as well as natural gas.
Texas Wind Power Up, Coal Down
Coal is on even more shaky ground, partly because new wind farms and other clean energy facilities are beginning to offer more competitive alternatives, and also because existing coal power plants are being converted to other fuels, namely biomass and natural gas.
As with nuclear power, the regulatory framework is also becoming more hostile to coal. Just yesterday the Washington Post editorial board urged President Obama to lay out a forceful climate change action plan in his upcoming State-of-the-Union address, noting that the Environmental Protection Agency is already poised to issue new rules that don’t require Congress to consent:
“The EPA has already established or is in the process of establishing a range of new air pollution rules. These rules will ensure than no new conventional coal plants are built in the United States, and they will force the closure of some particularly awful, ancient coal-fired facilities.”
The Global Energy Whack-a-Mole
Though the U.S. utility landscape is transitioning to safer, renewable forms of energy, that’s not going to have much of an effect on global greenhouse gas emissions.
The domestic market for coal is drying up, but U.S. coal companies have simply begun exporting more coal abroad. For that matter, pressure is mounting on Congress to allow more natural gas exports due to the domestic gas boom, and the proposed Keystone XL Pipeline would make the U.S. an export enabler of notoriously “dirty” tar sands oil from Canada.
As for nuclear energy, the nation’s stock of aging nuclear facilities is creating one giant headache for local emergency planners to say nothing of ratepayers and taxpayers.
It’s also creating a conundrum for diversified energy companies like Exelon, which operates the nation’s largest fleet of nuclear facilities but is also rapidly embracing wind and other renewables in its portfolio.
Last year, Exelon’s nuclear interests put it in the awkward position of opposing extension of the wind power tax credit, for which offense the company was kicked out of the American Wind Energy Association.
However, Exelon is also starting to amass significant wind power interests. Though wind and other renewables only account for about three percent of the company’s capacity now, that could change pretty fast.
Exelon’s first commercial wind farm only started operating in January 2012, and the company already has 44 wind projects operating in 10 different states.
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