The Need for Nuclear Energy in Texas

Jim Grace
February 18, 2017

Submitted as coursework for PH241, Stanford University, Winter 2017

Air Quality Challenges

Fig. 1: Road sign displaying the famous Texas anti-littering campaign slogan. (Source: Wikimedia Commons)

While Texas has long taken a hard stance on littering, the state's "Don't Mess With Texas" stance has unfortunately not extended from its roads to its air quality, which is now severely impaired by a number of key pollutants, including but not limited to ozone, particulate matter, and SO2. In fact, the two largest metropolitan regions in the state (Houston-Galveston-Brazoria and Dallas- Fort Worth) have struggled for over three decades to attain federal standards for ground-level ozone air pollution. With the addition of the Bexar and El Paso counties (and the extension of Dallas-Fort Worth's reach) in 2015, eight of the ten largest cities in Texas are now in non-attainment regions. [1]

Nuclear Energy Problems

Nuclear power plants provide another source of electricity without the high rates of greenhouse gas and air pollutant emissions associated with coal. However, recent estimates from the Energy Information Administration suggest that new nuclear plants have a higher levelized cost of generation (without subsidies) than natural gas, coal, wind, or geothermal. [2] In addition, nuclear plants involve very long lead times and substantial risk and uncertainty. As a result, most efforts to pursue nuclear energy are now occurring in regulated power markets that allow utilities to recoup costs plus a profit margin. For instance, a 2013 study prepared by two energy research firms found that conditional loan guarantees on Vogtle units 3 and 4 could expose the federal government to billions of dollars in losses. [3]

What's at Stake

While the problems with nuclear energy cause many to write it off as a fad and look to other sources to replace coal, that would be a mistake in the case of Texas. First, with Austin on the verge of non- attainment, Texas is at risk of all its major metropolitan areas being severely restricted due to pollution. Because of its history of non-attainment, the state is between a rock and a hard place. Either state legislators impose regulations that make for real, meaningful change in pollution levels or the EPA will force regulations on them. Ignoring for a moment the obvious health and environmental concerns, this would be awful for the Texas economy. Insufficient progress on these issues would hinder the state's ability to obtain federal funding for transportation projects, subject facilities within the non-attainment regions to stringent and costly source review requirements, and impair perceptions of the quality of life in the regions, making it difficult to attract new businesses and highly-skilled professionals. Because attainment is determined based on the highest reported design value, even a single monitor could bring an entire region into non-attainment status at any time.

Why Nuclear

In the past, the state of Texas has been hugely successful in encouraging renewable energy production despite ERCOT's extremely limited regulatory climate. While the state has long had a negative reputation for its huge CO2 emissions, it has slowly built an impressive renewable energy portfolio, topping the list of wind-generated electricity production for years. [4] Wind first boomed in the state of Texas largely because many of the energy producers were tired of the boom-and-bust cycles traditionally associated with oil production in the state. Even extremely robust investors like T. Boone Pickens expressed eventual distaste for the highly cyclical nature of the oil markets. [5] The EIA predicts that demand for energy will grow by 24 percent by the year 2035. With this increase, several Texas energy companies are already planning to take a risk on nuclear power despite the problems mentioned above. [2] As the only clean-air source of electricity that can produce round-the-clock, nuclear may prove to be the perfect solution for an energy-dominated state in search of the next big thing.

© Jim Grace. The author grants permission to copy, distribute and display this work in unaltered form, with attribution to the author, for noncommercial purposes only. All other rights, including commercial rights, are reserved to the author.


[1] B. Shaw, "Texas State Designation Recommendations for the 2015 Ozone NAAQS," Texas Commission on Environmental Quality, Sep 30 2016.

[2] "Annual Energy Outlook 2017," U.S. Energy Information Administration, January 2017.

[3] D. Koplow and M. Chang, "Vogtle 3 and 4 Conditional Loan Guarantees," Synapse Energy Economics and Earth Track, January 2013.

[4] "AWEA Market Report, Fourth Quarter 2016," American Wind Energy Association, January 2017.

[5] C. Krauss, "Move Over, Oil, There's Money in Texas Wind," New York Times, 23 Feb 08.