We don’t want to keep picking on Vermont. (Maybe we do. The story sort of writes itself.)
But the latest developments there are more interesting chapters in a state that wants to be the greenest in the nation, but keeps running into what some people there might see as “unintended consequences.” But they are utterly predictable to anybody who understands energy tradeoffs.
So here’s a summary of the last few weeks in the Green Mountain State:
- Entergy announced August 27 it is closing the Vermont Yankee nuclear plant, which provided about 70% of the state’s electricity. One of the reasons cited by the company: the availability of natural gas to produce electricity, with the fuel available in greater quantities because of fracking in the nearby Marcellus, and elsewhere.
That was followed by much celebration from anti-nuclear forces, who chose, in most of their writings, not to acknowledge the stated role of natural gas in the plant’s demise. (Here’s one example.) This way, the anti-nuke activists could make it look like the shutdown was entirely their doing — and to be honest, a lot of analysts think Entergy’s statements on the closure softpedaled the possibility that the company just didn’t have the stomach for the politics anymore — and ignore the fact that what has occurred is an opening for natural gas to grab market share, displacing emission-free power for a CO2-emitting fossil fuel. But the activists don’t see it that way; they see renewables as being ready to fill the nuclear-free gap.
- This has absolutely nothing to do with Vermont directly. But right about the time that Vermont dealt with the news that it needed eventually to replace all these emission-free atomic megawatts, the German magazine Der Spiegel — generally not considered a tool of the right wing — came out with a series of stories about the growing German crisis in its retail electricity rates. Its most damning description: electricity in Germany is becoming a “luxury.”
According to Platts’ German power analyst Andreas Franke, these pricing issues are not the result of the country’s decision to phase out nuclear power, which has not yet begun in earnest. But rather, it’s because of the German decision to turn increasingly to solar and wind, and the pricing and tariff rules that are needed to make that work. The result: rising electric retail prices. (And the Der Spiegel pieces are not the first time these issues have been raised in Germany. But it definitely is the most widely-circulated indictment).
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The potential similarities between where some in Vermont want to go, and what Germany already has begun to implement, are obvious: a nuke phaseout, but with a greater reliance on renewables to pursue lower-carbon emission power. But one difference is that Vermont’s advocates talk about “cheaper electricity.” That isn’t going to be happening much in Germany.
And Andreas noted, even as this push to renewables is ongoing, coal use in Germany actually is on the rise. He cites two main reasons: the drop in the price of EU carbon allowances and the decline in the price of coal, so that burning coal to produce high-priced electricity is “very” profitable. One other analogy to Vermont: similar to the fact that the Marcellus and its cheap gas is in Vermont’s neighborhood, Germany has an ample supply of cheap lignite.
So that raises the issue for Vermont: do you want to go down that German road and run the risk of higher retail electric rates? (To say nothing of whether the tree-lined ridges in the state are going to feature turbines and panels rather than pines and maples.) Or do you want to fill the Vermont Yankee gap with electricity powered by natural gas, either in-state or purchased across state lines, since the availability of that gas was cited by Entergy as a reason for the nuke plant’s closure?
And then we circle back to the Vermont paradox: it has banned fracking in its borders, which on a practical basis isn’t such a big deal because it is not known to have significant shale deposits anyway. But even if it ramps up its renewables program quickly, it’s still going to need something to substitute for the lost nuclear fuel, and natural gas is the easiest way to get there. But the natural gas increasingly will be from fracked wells in the Marcellus rather than from conventional sources in western Canada.
The fracking process was blasted by the state’s governor, Peter Shumlin, as “inject(ing) chemicals into groundwater in a desperate pursuit for energy.” He made that statement when he signed the fracking ban in 2012.
But as we’ve also pointed out, one of the biggest boosters of Vermont using more natural gas is…Peter Shumlin. And in this story just a week ago in Vermont’s biggest newspaper, the governor again talked about the expansion of natural gas capability in the state (which The Barrel wrote about here), and that he is fully onboard with that idea.
The Vermont paradox — the state’s desire to use more natural gas even as it has banned fracking as an intolerable evil — was always amusing to watch. But it took place against a backdrop where most of the state’s electricity was being generated by an emissions-free nuclear power plant. Vermont Yankee provided the state the luxury to be low on the emissions scale, have adequate supplies of power, while simultaneously criticizing fossil fuels and planning for a renewables future.
That luxury is going; hard choices await.