Thread by @Pro_Nuke

This is a thread that may be a little technical for some, but I think valuable. I copied from an email provided to me through people I used to work with at Point Beach. It was written by a former SRO/Shift Manager who's working non-nuclear now.

"Even though I have spent the last 15 years managing fossil powered peaking plants, I am still a nuke at heart. You are correct in that the late Paul Allen’s team is doing amazing reactor design research out in Oregon and Idaho. "

"That being said, as “Peaker”, I think I can add some insights to the whole nuclear economics dilemma. The real issue is regional power pools that were set up in 2006 by the Federal Government in their attempt to introduce competition to the utility industry. "

"In our case, Wisconsin along with majority of the Midwest, Mississippi River south and Manitoba belong to Mid-Continent Independent System Operator or MISO. They control the buying and selling of electric power products in the region. "

"Their markets only look at the cost of energy in any five-minute period and nothing else.
On the energy side there are essentially two markets, the Day Ahead & Real Time. The way it works is the day is divided into five-minute blocks."

"Most of the power is bought and sold in the Day Ahead Market. As the name implies, the day before, the utilities must bid all its available units along with the price per megawatt, the startup and shutdown cost and times, etc."

"The utilities also put in how many megawatts they need to purchase to cover their projected load demand. With the exception of the rare long-term purchase power agreement such as PBNP’s, if the power goes across transmission lines, it is bought and sold through MISO."

"Even if it is staying inside the utility. (WEPCO is selling all the generation from Oak Creek, etc. to MISO and then buying it back for its customers.) Around noon the day before, MISO will inform the utilities what units have been picked for which hours."

"MISO’s assumption is, if you are not the low-cost provider you can and will be turned off like a light switch. If you can’t be turned off such as a large coal or nuclear unit, you are put in the must run category. At that point you are subject to the Real Time Market."

"In the Real Time Market, prices move up & down depending on the real time needs of the grid. If something happens to a transmission line or a generating unit on a hot summer day, prices will rapidly rise until they are high enough to lured the utilities to put out more power."

"On the other hand, at 3:00 A.M in the spring or fall, you may be forced to pay to keep your unit on line. I have seen mornings where the price fell to a negative $17 to $20 a megawatt."

"A based loaded coal or nuclear plant can lose a lot of money quickly when they have to pay MISO to stay on line.
The regional markets are based on $/MWe for the five-minute period."

"They don’t care about a balanced generating portfolio or environment emissions, just what is the lowest cost provider the that five-minute period. The current market is extremely bias to anything that can’t be shut off in off hours."

"The idea that the market will provide seems ridiculously short sighted. Even the requirement for gas turbines to have a backup fuel to natural gas is no longer required."

"Life gets pretty interesting when the temperature dips below zero for any length of time and our natural gas gets curtailed. During the first big “polar vortex” a few years ago the regional power pool out east, PJM, lost over 23% of their generating assets over night."

"Between gas curtailments and freeze ups they lost a lot of units. I was at conference where the head of PJM spoke and he made mention that there is nothing like 24 months of fuel in the reactor core!"

"Their answer to the cold weather was huge fines for non-performance. MISO has really done nothing as the heavy coal and nuclear portfolio of the Midwest has always kept them out of deep pooh. That is changing as larger base load coal and nuclear plants are retired."

"In 2019, Wisconsin utilities retired the Pleasant Prairie Power Plant and Pulliman. Things would get very interesting if the feds or more states were like New York and outlaw fracking. Too many nuclear and coal plants have been removed from service."

"As much as I agree with you about the excessive cost of corporate officers, the real wooden stake in the heart of nuclear and coal is the regional power pools and their assumption that you need to be lost cost for any five-minute period or get turned off."

"Until Congress changes this, large stable base load plants are not competitive."
END