Part 2 of 2 Parts (Please read Part 1 first)
Most nuclear power plants are relatively inflexible in with respect their output. They cannot easily increase or decrease their output based on the demand. The way plants like Davis-Besse operate is to basically generate about the same amount of power around the clock. Unfortunately, sometimes the market price might not cover all of the plant’s costs.
Scheanwald said, “We are not really challenged with having to throttle our output. We are challenged more with the price of our electric output on the grid.”
Most commercial nuclear power plants have high fixed costs and low marginal costs. The relative inflexibility in varying their output and their high fixed costs are among the reasons that nuclear power plants are finding it more and more difficult to compete with electricity from natural gas and renewable energy.
In theory, the marginal cost to Davis-Besse for the nuclear power to make the hydrogen could be very low according to Pat Valente who is the executive director of the Ohio Fuel Cell Coalition. If their project is eventually scaled up, it could make the zero-emission production of commercial quantities of hydrogen fuel possible. Hydrogen produced in this manner would be considerably cheaper than it currently is on the open market.
Income from selling hydrogen fuel could provide a new revenue stream for the Davis-Besse nuclear power plants. Using some of the excess electricity to make hydrogen for fuel could be viewed as a form of energy storage. However, rather than being a mechanism for smoothing out the intermittent production of electricity, it would be a source of additional income and value when the hydrogen is purchased and used as fuel for fuel cells. Making on-site hydrogen would also cut the expense of buying hydrogen for use in the operation of the nuclear power reactors to cool and protect components. Dean from Exelon said, “If successful, we could reduce in-house hydrogen costs right away. Moving forward, we could explore the potential of selling clean hydrogen in the commercial market, giving our plants a new revenue stream.”
The technology for electrolysis is well established but the nuclear companies need to find out how it works in their facilities and whether or not it can be scaled up for commercial operation.
Scheanwald said, “I think the challenge in what we’re looking to prove in the pilot project is the integration of this … with our day-to-day nuclear operations.” If the pilot project is successful, Energy Harbor might eventually build a large-scale hydrogen production plant on-site with the nuclear power reactors.
Unfortunately, while new revenue from hydrogen production would be helpful, it is doubtful that scaling up hydrogen production could ever make up for the many competitive disadvantages the nuclear power plants face includingthe increasing number of natural gas power plants and the decreasing cost of renewable energy. Critics of the hydrogen production concept point out that renewable energy technologies can be more efficient for the reduction of greenhouse gas emissions.
The two-year project at Davis-Besse should begin running this coming winter although the pandemic or other factors might affect the timetable. Exelon is still in the process of selecting the site for its pilot project.