During his speech at the National Press Club on Wednesday, February 19, Energy Secretary Moniz made a comment about fuel resiliency that is worthy of discussion, especially as it might provide another opportunity for nuclear energy advocates to make the case for the importance of continuing to operate, develop and deploy our technology.
Dr. Moniz introduced the topic of “fuel resiliency” as part of his response to a question about why the US needs a federal energy policy, given that the market seems to be doing a pretty good job making choices that are beneficial to consumers.
Take the subject of the quadrennial energy review. Infrastructure, clearly, ultimately is in the private sector’s hands. But we have tremendous public interest and public needs for this. So, for example, we will be carrying out, at the department as part of this review, a whole set of fuel resiliency studies that are regional in nature. The fuel challenges that we have seen are very different in different parts of the country.
What will that lead to in terms of policy? Will it require some government sponsored installations? Will it require some suggestions of legislation? Will it require our working with the states in terms of their regulatory structures to encourage that we are moving coherently towards the kind of energy infrastructure that will move electricity and that will move fuels to people when they need them under normal conditions and when they need them under abnormal conditions?
This notion of moving electricity and fuel to people when they need it is another way of discussing the notions of grid stability and reliability that were a big part of NEI CEO Marv Fertel’s recent brief to Wall Street.
It is also a topic of concern for Senator Lisa Murkowski, who recently produced a report about the importance of baseload energy generators that use fuels like coal and uranium that can be stockpiled on power generation sites in advance.
Natural gas, for all of its frequently touted virtues, can become unreliable in times of stress on the grid and on the fuel delivery infrastructure. Methane (aka natural gas) is a low energy density fuel that is expensive to store and transport. Pipelines are great if they are already installed, but expanding their capacity is almost as expensive, difficult and time consuming as building new nuclear power plants.
It’s possible to give gas plants the capability to operate without continuous fuel delivery, but the normal method entails using petroleum distillate fuels stored in large tanks. Adding dual fuel capability to combustion gas turbines and providing on-site storage changes the economic and environmental calculation associated with low capital cost natural gas plants when compared to coal or nuclear energy options.
This issue is not a slam dunk for nuclear plants, but it is an area that adds value to plants that normally keep several months to several years worth of fuel on site and ready to burn. Unfortunately, that value is not one that can be well recognized by our current market structure. Though it might feel like central planning to some, the government has a role in introducing the discussion and helping market participants to recognize the insurance-like characteristics of widely-distributed, reliable generators that have more than a couple of days worth of fuel on site.
Fuel resiliency and diversity is not a sufficient reason, by itself, to build new nuclear plants or even to maintain existing ones, but it is a factor that is too frequently overlooked and undervalued.