April 7, 2011

Should Nuclear Energy Producers Invest in Alternatives?

Posted in energy policy tagged , , , , , , , at 11:28 am by realitytax

That’s a daunting potential, in some people’s minds. There’s recent interest in nuclear companies “Hedging Their Bets” by investing in Wind/Solar assets. Could they be planning to stifle competition? I don’t think so.

With lesser known French and British firms competing against key U.S. players such as Exelon (which invested $900 million to acquire John Deere Renewables) or the mega-conglomerate General Electric ($600 million to build a solar factory) they are all assuredly anticipating substantial ROI or risking their shareholders wrath.

If the U.S. is relying increasingly on energy from wind and/or solar sources, demand will likely be to move it beyond the borders of the property where it’s generated along the existing grid. Grid providers have incentives to maintain access, and I’m heartened to think that if any business invests substantially in any asset or resource they have at least some market-based incentive to protect that investment and reaping monetary return than letting it go to waste, just as those who provide and maintain the grid want reliable sources to deliver for their customers.

(Reuters) – General Electric Co made a big push in solar power, saying it will invest $600 million to build a new factory as it pursues what it thinks could be an up to $3 billion business by 2015.

By Scott Malone and Matt Daily
BOSTON/NEW YORK | Thu Apr 7, 2011 12:16pm EDT

Of course, none of that technically precludes simply holding those assets away from the market to drive up demand for nuclear power, which represents a potential return on the investment – a traditional bottom-line goal. So let’s agree that GE, Exelon, Areva, and others investing large sums aim to stay in business.

Nellis AFB Solar Panels
It follows that as nuclear becomes either unacceptable or even less cost-effective (and increasingly there’s actuarial data supporting the latter in the wake of the Fukushima disaster) that corporate growth, vitality, and “business success” will require savvy, competitive utilization of resources and assets, which now include literally hundreds of millions of dollars each of wind and solar investments.

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