A report by Brattle Principals Mark Berkman and Dean Murphy finds that the Salem and Hope Creek nuclear power plants make substantial contributions to the environment and to the New Jersey economy.
The report, prepared for Public Service Enterprise Group (PSEG) and Exelon Generation, considered the environmental effects of these plants, and also how they affect electricity markets and prices. While keeping the Salem and Hope Creek nuclear plants operating might be expected to be costly for customers, it could in fact save them money on their electricity bills, even if the plants need financial support to remain viable. The authors explain that in addition to their environmental benefits, these nuclear plants also keep electricity prices lower, which provides broader economic benefits in terms of gross domestic product (GDP), jobs, and state tax receipts.
The analysis characterized both the power sector and New Jersey’s economy, first with and then without the Salem and Hope Creek nuclear plants, to estimate their effects on emissions, power prices, and New Jersey’s economy. It found that these plants provide substantial benefits to New Jersey that would be lost if the plants retire prematurely. The loss of these plants would:
- Increase pollution, raising annual carbon dioxide (CO2) emissions by almost 14 million tons, and other pollutants by tens of thousands of tons, adding an estimated $733 million a year in total environmental and human health costs;
- Cause electricity prices to rise, costing New Jersey families and businesses $400 million more per year for electricity, on average over 10 years;
- Harm New Jersey’s economy, reducing annual state GDP by $809 million per year;
- Result in the loss of 5,800 jobs across New Jersey’s economy; and
- Cause a reduction in state tax receipts estimated at $37 million.
This analysis effectively calculates the gross economic benefits of preserving these plants, without accounting for any cost of supporting the plants. Of course, any support costs must be weighed against these economic and environmental benefits.
The report, “Salem and Hope Creek Nuclear Power Plants’ Contribution to the New Jersey Economy,” is available for download below.