A coal, nuclear power bailout may cost more than $34 billion, study says

July 20, 2018

A Trump administration plan to bail out otherwise uneconomical coal-fired and nuclear power plants potentially could cost consumers more than $34 billion over a 2-year period, a study commissioned by the Natural Gas Supply Association, American Petroleum Institute, and four other national energy associations concluded.

The Brattle Group, in a study that the groups jointly released on July 19, estimated that such a bailout could directly cost consumers:

  • $16.7 billion/year, or $34 billion for 2 years as proposed, if every US coal and nuclear power plant was given a uniform (dollars per unit of capacity) support at the level of the average financial shortfall experienced by such plants.
  • $9.7-17.2 billion/year, or $20-34 billion over 2 years, if only those plants that now face shortfalls were given payments sufficient to cover their operating losses.
  • $20-35 billion/year, or $40-70 billion total, if power plant owners were also granted a return on their invested capital in addition to payments for operating shortfalls.
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