This Washington Examiner article looks at the newly released The Brattle Group Report, which estimates the costs of the current administration's coal bailout at $17.2 billion per year. AEE with funding from a coalition commissioned the report. Link to the full article here. Link to the Brattle Group Report here. Excerpts below:
President Trump’s plan to save coal and nuclear power plants could cost a whopping $17.2 billion per year, a new study funded by opponents of the bailout said Thursday. The Brattle report was done for the Advanced Energy Economy and funded by members of a broad coalition of strange bedfellows opposing the Trump bailout.
The report by the consulting and engineering firm Brattle looked at two scenarios to assess the possible cost of a Trump power plant bailout that range from $16.7 billion to 17.2, far exceeding a recent estimate from a coal group that said it would cost $4 billion per year. Brattle based its assessment on an administration draft memo reported by news outlets on May 31 to inform its analysis.
Trump ordered Energy Secretary Rick Perry to develop a plan to save coal and nuclear plants from closing prematurely due to unfavorable market conditions, notably the low cost of natural gas.
The report’s first scenario applies a market annual payment of $50 per kilowatt of electricity for power plants if they continue to operate. The scenario assumes that the payments would apply to the entire current fleet of coal, including 235.8 gigawatts, and nuclear, comprising 99.1 gigawatts, which would imply a direct cost of $16.7 billion dollars per year. The payments would take the form of out-of- market payments via contracts or other mechanisms, according to the report.
The $17.2 billion is what the oil and natural gas industry will be using in arguing against the coal and nuclear power plant bailout. The coalition opposing the Trump plan says it undermines the electricity markets to favor more expensive and less efficient forms of energy. But the Brattle report goes even further by saying the Trump plan could reach as high as $35 billion per year, depending on how the payments are devised by the administration.
Link to the full WE article here.