August 2008

Tackling Climate Change

CONTENTS

Reactor renaissance
Growing need for clean power positions nuclear for a big comeback

by Peter Nye

Tackling Climate Change:

Oct. 2009 - "In search of a better battery" Sept. 2009 - "Cleaner generation"
Aug. 2009 - "The new nuclear"

July 2009 - "At the speed of light"

May 2009 - "Renewing Innovation"

April 2009 - "Defining affordability"

March 2009 - "More productive kilowatts"

Feb. 2009 - "Citizen lobbyists"

Jan. 2009 - "Planning our energy future"

Dec. 2008 - "Affordable & reliable"

Oct. 2008 - "Can we capture carbon?"

Aug. 2008 - "Reactor renaissance"

July 2008 - "Putting you first"

June 2008 - "Running out of power"

May 2008 - "A sound approach"

Despite being largely ignored for nearly three decades, nuclear power has re-emerged as a darling on the national stage. In June, the Tennessee Valley Authority restarted its Browns Ferry Unit 1 reactor in Alabama after a five-year, $1.8 billion refurbishing project — making it the first “new” U.S. nuclear reactor to come online in 11 years.

In September, the federal Nuclear Regulatory Commission (NRC) announced that it expects to receive up to 29 applications from utilities to build new nuclear power plants in 20 states, chiefly in the South. Applications are already rolling in.

To ensure proper oversight, NRC has also created an Office of New Reactors, staffed with 400 inspectors, nearly as many as oversee the nation’s existing 104 nuclear units. The agency believes the next wave of nuclear power plants could begin feeding the grid between 2015 and 2020.

This revival comes courtesy of the central issue swirling about legislative circles today: climate change.

“Electric utilities are scrambling for ways to generate more electricity while curbing emissions of greenhouse gases,” explains John Holt with the National Rural Electric Cooperative Association. “As a result, lots of attention has been focused on nuclear power. It’s the only source other than coal that can generate adequate amounts of reliable baseload power to meet growing demand, and it only emits steam — clean water vapor.”

Coal-fired power plants, which generate roughly 50 percent of the nation’s electricity, account for approximately 34 percent of U.S. carbon dioxide output and about 40 percent of all greenhouse gas emissions from human activity.

“From a public policy perspective, climate change is a pressing crisis, and nuclear is a proven off-the-shelf technology that emits essentially no carbon dioxide,” says Tom TerBush, manager of nuclear market strategy for the Electric Power Research Institute (EPRI). “That makes nuclear power an attractive option to have as part of a utility’s generation mix.”

Overall, nuclear power plants provide 20 percent of the nation’s power supply, second to coal. For electric co-ops, 13 percent of the power produced by generation and transmission (G&T) co-ops, and 15 percent of all power requirements, are supplied by nuclear.

Ameren UE’s Callaway Power Plant is Missouri’s only commercial nuclear power plant. It has a capacity of 1,190 megawatts. The plant was first announced in 1973 and was declared fully operational in December 1984. The St. Louis-based investor-owned utility has announced it is considering adding a second unit, dubbed Callaway II, to the site in central Missouri. Photo courtesy of Ameren.

Earlier this year, EPRI released a study showing how utilities could reduce carbon dioxide emissions below 1990 levels within 23 years — even as they add about 40 percent more load — by taking aggressive steps in seven principal areas. The study called for nudging nuclear power up to 25 percent of market share by 2030.

“The country already has 100,000 megawatts of nuclear power capacity,” TerBush remarks. “We project adding 24,000 megawatts of new nuclear by 2020 (roughly 12 two-unit plants) and then 4,000 megawatts a year after that to reach a total of 64,000 megawatts by 2030. That amount would prevent about 260 million metric tons of carbon dioxide being emitted by the electricity sector.”

Most of the nation’s nuclear fleet was ordered in the late 1960s through the late 1970s and operational by the mid-1980s. But after the infamous March 1979 accident at the Three Mile Island nuclear plant in Pennsylvania, many planned reactors were shelved.

Those under construction, meanwhile, experienced crippling delays and skyrocketing cost overruns due to additional safety features and design changes mandated by the NRC. Holt notes one G&T that had bought into a nuclear plant at the time saw costs to finish the facility escalate from $400 per kilowatt-hour to $5,000 per kilowatt-hour.

“Before Three Mile Island, nuclear power was sometimes advertised as being ‘too cheap to meter,’” he recalls. “However, in the aftermath, the exploding debt burden heaped on utilities that had made nuclear investments, coupled with public fear about catastrophic nuclear plant meltdowns, essentially put the industry into a deep sleep. Ironically, cost factors and new public fears of global warming have awakened it.”

With utilities having paid down nuclear debt considerably over the past two decades, the nation’s reactors last year produced electricity for an average of 1.72 cents per kilowatt-hour according to the Nuclear Energy Institute. That compares with 2.37 cents per kilowatt-hour for coal and 6.75 cents per kilowatt-hour for natural gas-fired plants.

“Unlike fossil fuels, a rise in uranium prices to power nuclear reactors has only a minimal effect on the price of electricity,” Holt says. “And uranium is a natural resource in plentiful supply. About half of the nuclear power generated in the U.S. today comes from dismantled and reprocessed nuclear weapons, a sizeable chunk being old Soviet warheads.”

Holt believes construction costs in the anticipated “nuclear build cycle” should be easier to calculate than they were the previous go-around, as applicants are planning to use standardized advanced reactor designs. The NRC has already certified two of the five most likely designs, all of which boast a smaller plant footprint.

“The new plants will include significant safety improvements over the boiling water and pressurized water reactors used today,” he mentions. “For starters, they won’t rely on active components like coolant pumps, fans, chillers or diesel generators to shut things down in an emergency. To reduce human error, the plants will feature more passive systems that can open and close valves automatically using gravity or water flow to cool reactor cores, multiple backup power supplies and digital control rooms. And they will incorporate enhanced post-9/11 security measures, including hardened concrete exteriors that can better withstand the shock of events such as an airplane strike.”

To keep work on the fast track, most new nuclear plants will rely on modular construction with large parts, such as the reactor vessel, made in other countries like Japan. By using standardized design and modular construction, nuclear plant contractors like General Electric claim they can construct an entire facility from the ground up in about 36 months.

Even with climate change pressures, nuclear power still faces heavy political and philosophical opposition in many circles. In February, Standard & Poor’s Rating Services noted that nuclear “is realistically only available to those G&Ts that are participants in an existing plant considering unit expansion.”

Holt reports that eight G&Ts have talked with investor-owned utilities about possible participation in new nuclear power plants. “If plans for a nuclear plant of 1,000 megawatts to 1,500 megawatts capacity were permitted in 2008, the earliest one could go online would be 2015,” Holt estimates. “The cost would be at least $5 billion, and maybe higher, per unit of that size.”

Nye is a writer for the National Rural Electric Cooperative Association.

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