The Energy 202: The United States is running out of nuclear options RSS Feed

The Energy 202: The United States is running out of nuclear options

When planning began on two new nuclear reactors at Plant Vogtle in eastern Georgia a decade ago, Southern Company’s Georgia Power thought the project would be one of several to come online in a wave of new nuclear power plants opening in the United States.

But as of this week, the two still-to-be-built reactors in Georgia are alone among new nuclear projects under construction in the United States.

On Monday, a pair of utilities, private SCANA and state-owned Santee Cooper, canceled construction on a pair of nuclear reactors in South Carolina after years of mounting building costs, stagnant electricity demand and competition from natural gas and renewables.

Today, 60 percent of the carbon-neutral energy produced in the United States comes from the nation’s existing 99 nuclear power plants. The failure to complete the partially finished South Carolina reactors dims hope that nuclear power can play a greater role in further decarbonizing electricity generation in the United States — at least anytime soon.

Many of the same economic forces that factored in the South Carolina decision weigh on the prospects of the Vogtle plant and its two planned nuclear reactors.

In March, Westinghouse, a once storied nuclear-energy business and lead contractor on both the South Carolina and Georgia reactors, went bankrupt.

In the years leading up to that filing, Westinghouse, along with nuclear energy boosters, touted its new AP1000 model reactor as the safer, cheaper and faster-to-build technology that would bring a “nuclear renaissance” to the United States, which has completed only one nuclear reactor since the 1980s.

Instead, the reverse happened. Since 2013, five nuclear power plants have retired soon after gains in a hydraulic-fracturing technology made natural gas cheap and abundant in the United States.

“In any industry, if it’s not growing it’s dying,” Rich Powell, executive director of the ClearPath Foundation, said. “If we can’t keep some construction going, our already pretty challenged nuclear renaissance will become fully challenged.”

After Westinghouse’s bankruptcy, Southern’s nuclear-energy unit took over construction of the new reactors. With a larger market capitalization than SCANA, Southern appears willing to take on more risk in building the project.

Stan Wise, a commissioner on the Georgia Public Service Commission overseeing the Vogtle project, noted that the number of co-owners in the Vogtle project — Oglethorpe Power Corp., Municipal Electric Authority of Georgia and Dalton Utilities in addition to Southern — as well as the large electricity market in Georgia diffuse the financial risk of building the reactors.

“The dissimilarities of these projects should be recognized before making any suppositions on whether construction will continue at Plant Vogtle based on decisions made in South Carolina,” Wise said in a statement.

But the cost of the project in Georgia, like that in South Carolina, has swelled.

Back in 2009, Southern, which owns about a 46 percent stake in the project, estimated that the new Vogtle reactors would cost the company a total of $4.4 billion. Before Westinghouse’s bankruptcy, that estimated cost grew to $5.7 billion if both reactors were completed by 2020. If the completion date is pushed back another three years, to 2023, that figure could grow to $7.4 billion, according to a preliminary estimate this week from Southern.

State regulators, in consultation with the reactors’ co-owners, will make a final decision about the future of the project later this year. Southern has indicated it wants to go forward.

“From a lot of scenarios, going forward with nuclear may make sense,” Tom Fanning, Southern chief executive, told investors on Thursday.

Part of the reason nuclear reactors have become so expensive to build in the United States is that the nation has constructed so few recently. “We’ve allowed our nuclear construction ability to atrophy,” Powell said.

The Energy Department has stepped in to try to kick-start nuclear-energy construction. The new Vogtle reactors, for example, have the backing of the department, which lent funding to the project through its loan guarantee program.

Energy Secretary Rick Perry has spoken glowingly of nuclear energy as a part of the Trump administration’s official “all-of-the-above” energy strategy. But President Trump himself spends significantly more time talking about coal, while the White House’s proposed budget, if passed, would drastically reduce funding for the department’s nuclear-energy office and eliminate the loan program altogether.

The future of nuclear energy likely lies with companies pursuing new technologies, such as small modular reactors. Unlike the Vogtle plant and its other larger cousins, modular reactors — like those being developed by a company called NuScale in rural Idaho with Energy Department support — are designed to avoid cost overruns by being built in factories.

Read full article at The Washington Post