Holtec Gets Help from Michiganders // The No Good Very Bad Nickel Fraud // EIA: Coal and Nat Gas Are 98% of 2023 Retirements

Holtec Gets Help from Michiganders

Holtec International, which has been fighting to keep the Palisades nuclear power plant in Michigan running, just got a boost from locals.

The Allegan County Board of Commissioners and Van Buren County Board of Commissioners expressed support last Thursday for Holtec's bid for federal funding to reopen the Palisades Nuclear Plant. Palisades closed last May after 50 years of operation. Holtec took over the plant for decommissioning, but decided it wanted to keep it running and applied for the Department of Energy's Civil Nuclear Credit Program last July. The company was denied in November of 2022 but it plans to apply again when the application window re-opens.

"Jim Storey, board chair, said during Thursday’s meeting Holtec was planning to apply soon and wanted to have evidence of community support. Holtec is 'on track to file' the application, according to Nick Culp, senior manager of government affairs and communications," reports The Holland Sentinel.

“We are encouraged by the public support we have received, recognizing the benefits of this effort to provide Michigan with a safe, reliable source of carbon-free electricity while supporting jobs and the regional economy,” Culp said.

The board's resolution cited several reasons it wants to keep Palisades running. “Palisades provided 600 full-time, highly skilled, and good-paying jobs in Southwest Michigan, which were supplemented by the influx of an additional 1,000 specialty workers into the community to support scheduled refueling and maintenance outages,” the resolution reads.

Holtec recognizes that obstacles to reopening the plant--such as facility maintenance and improvement, procuring a power purchase agreement, upgrading the switchyard, and rehiring staff--remain even if they secure funding.

The No Good Very Bad Nickel Fraud

Trafigura Group, a commodity trader is facing over half a billion dollars in losses, after it discovered that nickel cargoes it bought did not contain in fact contain nickel.

"Trafigura has spent the past two months uncovering what it believes is a systematic fraud against it. It has started legal action against Indian businessman Prateek Gupta and several companies connected to him including TMT Metals and subsidiaries of UD Trading Group, Trafigura said in a statement," reports Bloomberg. "The missing nickel is a blow for the company that has grown rapidly in the past decade to become one of the world’s largest trading houses. It’s also another black mark for the metals-trading industry, which in recent years has been beset by tales of fake warehouse receipts, duplicate shipping documents and containers filled with painted rocks."

The company has recorded a $577 million impairment as a result of the fraud, though the number could lower if they recover some funds. Trafigura does not believe anyone at their company is responsible for the fraud.

The loss has raised questions about the firm's processes for trade verification and checking counterparties. It also puts a firmer squeeze on Trafigura's metals unit, which has been outperformed by the energy traders.

EIA: Coal and Nat Gas Are 98% of 2023 Retirements

In 2023, America will retire 15.6 gigawatts of electric-generating capacity--mostly from gas-fired and coal power plants.

Coal: America has retired a boatload of coal over the last decade, with 2015 seeing a record 14.9 GW retired. Between 2015 and 2020 the average annual retirements was 11.0 GW. This dropped to to 5.6 GW in 2021 before jumping to 11.5 GW in 2022.

In 2023, 8.9 GW of coal-fired capacity is planned to be retired, which is 4.5% of the total coal-fired capacity at the start of the year. The main reason for the retirements is competition from highly efficient natural gas-fired power plants and low-cost renewables, such as wind and solar.

"Most coal-fired power plants operating in the United States were built in the 1970s and 1980s," reports the EIA. "As these aging coal-fired power plants compete with a growing number of highly efficient, modern natural gas-fired power plants and low-cost renewables, such as wind and solar, more of these coal-fired power plants are being retired."

Electricity restructuring also disadvantaged these plants (in addition to nuclear plants) as they favor just-in-time natural gas and renewables.

Natural Gas: "This year, 6.2 GW of U.S. natural gas-fired capacity is scheduled to retire, representing 1.3% of the operating natural gas fleet as of January," reports the EIA. "Most of the retiring natural gas capacity is made up of older steam and combustion turbine units, which produce electricity less efficiently than many of the newer combined-cycle natural gas units."

Three aging natural gas-fired plants in California--some 2.2 GW of capacity all told--are slated to retire by the end of 2023. Originally, they were supposed to close in 2020, but were given three-year life extensions to firm up California's fragile grid.

Petroleum: Petroleum-fired power plants account for a minor share of energy generation in the United States, at approximately 2.2%. In the post-WWII era, they accounted for almost ten-times that amount. These plants are mainly used as peaker plants to provide power during high demand times like severe weather conditions--e.g., last week in New England. In 2023, a planned retirement of 0.4 GW of petroleum-fired capacity is expected in the country.

Like what you're reading? Click the button below to get Grid Brief right in your inbox!

Conversation Starters

1. Cameco will supply Ukraine with uranium into the next decade. "Ukraine's state-owned nuclear energy utility Energoatom and Cameco Corporation have agreed commercial terms for a major supply contract that would see Cameco meeting Ukraine's needs for natural uranium for nuclear fuel until 2035," reports World Nuclear News. "The contract will see the Canada-based fuel producer 'provide sufficient volumes of natural uranium hexafluoride, or UF6 (consisting of uranium and conversion services), to meet Ukraine's full nuclear fuel needs through 2035.' The agreement will run from 2024 to 2035, with all deliveries in the form of UF6. The contract - which the companies said they anticipate will be finalised during the first quarter of this year - will 'contain a required degree of flexibility, given present circumstances in Ukraine.'"

2. A carbon capture facility in Texas just got a new lease on life. "Owners of the world’s largest carbon capture facility plan to restore operations at the $1 billion plant three years after it shut down, providing a test case for a nascent industry that experts believe is essential in achieving climate goals," reports Bloomberg. "JX Nippon aims to restart thePetra Nova facility in Texas afterNRG Energy Inc. finishes repairs on the coal-fired power unit to which it is connected, the company said in an emailed response to questions. NRG said it’s scheduled to complete the work in June."

3. Kazakhstan is banning fuel exports. "Kazakhstan is banning the export of fuels for four months regardless of the mode of transportation, beginning on February 18, the Kazakh Finance Ministry said in a statement. The country is banning exports of gasoline, diesel, and certain types of other oil products, the state revenue committee at the ministry said on February 8, with the ban effective ten days after the announcement," reports Oilprice.com. "The Kazakh Finance Ministry thus informed all participants in foreign trade, carriers, freight forwarders, customs representatives, and other stakeholders that they should comply with the ban. The purpose of the ban is to ensure enough fuel supply domestically and prevent shortages."

Crom's Blessing