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Kentucky closes in on lifting nuclear power moratorium

Louisville, Kentucky (Platts)--6 Mar 2017 613 pm EST/2313 GMT


Kentucky may be on the cusp of lifting a decades-old moratorium on nuclear power plants, with supporters of the move hoping to perhaps attract a smaller modular facility to the commonwealth to help diversify its coal-dominated generation fleet.

The Kentucky House of Representatives is expected to hear Senate Bill 11, possibly later this week, after it easily passed the full Senate on a bipartisan 27-8 vote last week.

For the first time since the 1930s, Republicans control both both houses of the Legislature and Governor Matt Bevin is a Republican as well.

Republican State Senator Danny Carroll, the bill's primary sponsor, said in a Monday interview that removing the nuclear ban is crucial to giving the state a balanced generation mix.

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Coal, he added, still fuels more than 80% of Kentucky's generation, although natural gas is on the rise. The state has no nuclear plants and very little renewable energy.

Aside from energy diversity, economic development also plays an important role in the bill's aspirations.

"There are certain industries that look at energy policies where, if they see a state heavily relying on fossil fuels, they may not relocate there for that reason," Carroll said.

Similar legislation has been introduced in the past in Kentucky, only to fall by the wayside. Carroll thinks this year may be different.


HOUSE SAID TO BE SUPPORTIVE OF BILL


Carroll said his House colleagues have voiced support for the bill, which is expected to get an airing in the House Natural Resources Committee either this week or next.

Although time is running out on the 2017 session -- the General Assembly is scheduled to adjourn by the end of March, he thinks there is sufficient time to pass it.

If so, Bevin "has indicated he will sign the bill if it comes to his desk," he said.

Depending on one's perspective, Kentucky's powerful coal industry has been blamed or credited in the past with successfully lobbying to defeat pro-nuclear legislation, viewing nuclear power as a potential threat to its long-time dominance.

However, Carroll said Mike White, interim president of the Kentucky Coal Association, has told him the industry will not oppose S.B. 11. Attempts to reach White for comment were unsuccessful Monday.

Carroll said supporters realize no nuclear plants will be built in Kentucky for years, perhaps decades, even if the bill becomes law.

"We're planning for the future," he said. "Especially with all the technology and advances that are coming along, that will make nuclear more efficient. In planning energy policy for the commonwealth, we have to think not years down the road, but decades down the road."

"If we do get into a position where energy prices in our state start creeping up, it would be nice to have that third option" behind coal and gas, he added.


LEADING ENVIRONMENTAL GROUP NEUTRAL ON BILL


The Kentucky Resources Council, the state's leading environmental group, is neutral on the bill, according to its long-time director, Thomas FitzGerald.

"Senator Carroll and I both realize that this will not result in a nuclear plant being built in Kentucky in the next decade or longer, absent a major advance in reducing costs, eliminating runaway project overruns and a strategy for managing and disposing" of the waste generated, FitzGerald said in a Monday email.

Still, removing the nuclear ban "might allow Kentucky to bid for research dollars, however."

FitzGerald said, however, that other environmental groups still vigorously oppose the bill.

The Nuclear Energy Institute, Kentucky Chamber of Commerce, Kentucky Association of Counties and the Kentucky Municipal League all support the measure.

Pointing to pro-nuclear legislation and administrative actions recently approved or taken in Illinois and New York to protect existing nuclear plants from closing, NEI spokesman John Keeley said the industry is enjoying newfound momentum.

"We saw Wisconsin overturn its [nuclear] moratorium relatively recently," he said Monday. "Increasingly, you're seeing policymakers at the state level realizing you don't get a whole lot out of a moratorium like this. You're needlessly limiting your options for power generation."

Michael McGarey, another NEI spokesman, said 11 states, including Kentucky, have some type of prohibition against new nuclear plant development, with Hawaii having an outright ban.

--Bob Matyi, newsdesk@spglobal.com

--Edited by Keiron Greenhalgh, keiron.greenhalgh@spglobal.com

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