The House of Representatives on Friday passed a sweeping spending package that would, if enacted, give economically-troubled nuclear power plants another financial boost in addition to the Department of Energy’s ongoing bailout program.
Among the provisions in the Inflation Reduction Act, which the House passed Friday evening on a 220-207 party line vote, the bill proposes a production tax credit for nuclear power plants. Such a tax credit would be calculated based on the kilowatt-hours produced and sold by qualifying facilities.
The Senate passed the proposed measure late Sunday on a 51-50 party line vote.
Nuclear plants that are privately-owned or built after the enactment of the law would not qualify for a tax credit, the measure said. Advanced reactors are also ineligible.
The bill directs the Secretary of Energy to establish “regulations or other guidance” for doling out the credits. If it became law, the program would begin in 2024 and run for about ten years — through 2032.
A nuclear industry professional organization the American Nuclear Society (ANS) welcomed the provision in a press release Monday.
“If enacted, these provisions will boost production of zero-carbon nuclear energy in the U.S. through the preservation of our existing nuclear fleet, and the scale-up of new and advanced reactors,” ANS said. “More broadly, these provisions will accelerate the transition to a ‘net-zero’ power grid without jeopardizing our energy independence or resilience.”
If signed into law by President Joe Biden, the tax credits scheme would be the second federal program created in recent months aimed at stemming the tide of U.S. nuclear plant closures.
DOE is in the midst of the application period for the first round of its roughly $6 billion civil nuclear credits program, which became law as part of November’s bipartisan infrastructure bill. According to the law, money for that program — which consists of individual awards rather than tax credits — should be given out in $1.2 billion increments over a five-year period.
As the feds work to keep nuclear power alive, the fates of a couple of plants hang in the balance. Michigan’s Palisades Nuclear Generating Station was the most recent to go offline May 20. State Gov. Gretchen Whitmer (D) has said that she would work to bring the plant back online despite skepticism from its former operator.
Meanwhile, California is weighing whether to keep its last operating nuclear plant operating for a little while longer. Although its two reactors are still set to shutter in 2024 and 2025, Diablo Canyon Power Plant’s current operator Pacific Gas & Electric has said that it would bid on part of the DOE nuclear credits program.
In 2021, just one nuclear power plant shut down — Indian Point Energy Center in New York. Illinois’s Byron and Dresden plants were also scheduled for closure last year, but a late-game bailout from Springfield kept the lights on.
Updated 08/15/2022 7:31 p.m. Eastern time with House vote tally.
