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Released October 03, 2012 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Unless the nuclear power industry is able to solve its spent fuel challenges, the already-lowered expectations about a renaissance for nuclear power may have to be lowered even further, Sarah Hoffman, a deputy commissioner with the Vermont Public Service Department (Montpelier, Vermont), told an industry webcast in late September. Panelists on the webcast, organized by Energy Central, addressed the question, "What is Nuclear Power's Future in America?"
"How we decide as a country what to do with spent nuclear fuel is critical to the future of nuclear power," Hoffman said in the September 20 webcast. Dozens of license renewals have been granted to existing nuclear generators. More than a dozen license extension applications are being considered by the U.S. Nuclear Regulatory Commission (NRC) (Bethesda, Maryland). And new nuclear plants are being built. But nuclear power's renaissance in the U.S. will be complicated by the continued inability to build a central spent fuel repository, she predicted.
"I may come off like the skunk at the garden party, but this is a problem that cannot be ignored," Hoffman continued. "We have over 70,000 metric tons of spent fuel at nuclear plants across the country, and that number will double by 2055." Left unresolved, spent nuclear fuel could be one factor that "dooms to failure" efforts to build new nuclear plants, she said.
"No one wants to see spent nuclear fuel lingering onsite for indefinite periods of time," she said in the webcast. "There are too many safety and environmental impacts." The costs of spent nuclear fuel management and disposal also must be reflected in the cost of electricity generated from nuclear power plants, she urged. Today, those costs are not reflected in electric rates. Rather, those costs are being absorbed by the U.S. Department of Energy (DoE) (Washington, D.C.), which also is responsible for creating a permanent repository for spent nuclear fuel.
Efforts to build a repository for spent nuclear fuel, under way for decades, received another setback recently when a federal court told the NRC it had to consider the environmental consequences of continuing the current practice of storing spent nuclear fuel at the sites of nuclear power plants. In 1987, Congress amended the Nuclear Waste Repository Act to designate Yucca Mountain, Nevada, as the nation's centralized site for spent nuclear fuel. But in the 25 years since that amendment was passed, litigation, political maneuvering and competing geologic assessments have prevented a single shovel of dirt from being turned at Yucca Mountain.
Meanwhile, the DoE has collected more than $25 billion to pay for handling spent nuclear waste, but that money sits unspent. "In the Vermont vernacular, that's as dumb as a stone," Hoffman commented. "We need to get beyond wishful thinking on spent nuclear fuel, or the industry really is doomed to failure. We need to create a new organization, separate from DoE, to implement a waste management strategy. There are many reasons why DoE has not succeeded, but it's time to move on."
Low-priced natural gas is another challenge facing potential new-build nuclear projects. "Can nuclear power compete with natural gas at today's prices, or will competition with gas be the true death knell for nuclear power?" Hoffman asked. Today's natural gas price of about $3 per million British thermal units (MMBtu) is less than half what it was a few years ago, when the nuclear industry was looking forward to building several new nuclear generators in the U.S. But since then, low gas prices have figured prominently in decisions to abandon several proposed new-build nuclear generators. Exelon Corporation (NYSE:EXC) (Chicago, Illinois) recently abandoned plans to build a two-unit merchant generator in Victoria, Texas. Other developers, including NRG Energy Incorporated (NYSE:NRG) (Houston, Texas) and Constellation Energy (Baltimore, Maryland), now part of Exelon, also abandoned new-build nuclear projects. For more on that, see April 22, 2011, article - NRG Energy Ends its Investment in South Texas Project Units 3 & 4, and October 15, 2010, article - Constellation Energy Exits Calvert Cliffs Unit 3, Stunning Industry and Potentially Slowing Nuclear Renaissance.
Hoffman and her co-panelists from the NRC and Southern Company (NYSE:SO) (Atlanta, Georgia) agreed that the consequences of the meltdown of the Fukushima Dai'Ichi nuclear plant in March 2011 is another issue that will shape the future of nuclear power in the U.S. "I agree that we cannot underestimate the impacts of Fukushima," NRC Commissioner William Ostendorff told the webcast. "The NRC has taken a very serious and thoughtful look at those issues over the last 18 months."
Cheri Collins, nuclear operations development, general manager and external affairs liaison for Southern Company, made this comment: "We are aware the world is watching" Southern's construction of units 3 and 4 at the Vogtle Nuclear Plant. "We are diligently focused on building a safe plant on schedule and on budget."
Collins vehemently and repeatedly denied that the new units at Vogtle are experiencing cost overruns: "There are no cost overruns. We have not asked the Georgia Public Service Commission to adjust its certified budget" of $14 billion for the two new units, which are scheduled to come online in 2016 and 2017. Low interest rates and falling commodity prices are helping keep down the cost of the project, she said. In addition, Southern has yet to finalize the terms of its $8.3 billion federal construction loan guarantee. For more information on that issue, see February 17, 2010, article - Obama Administration Commits $8 Billion in Loan Guarantees to Georgia Power's Vogtle Units 3 and 4.
The Southern Company executive also noted the Georgia PSC is allowing Southern subsidiary Georgia Power Company (Atlanta, Georgia) to begin charging its customers for the cost of building the new units, before construction is complete. This will lower the overall cost of the project compared to other states where utilities can only charge customers for a project once construction is complete and the regulators deem the project "used and useful."
"This is a complex project where there will be ebbs and flows," Collins said of the Vogtle construction project. She said there is "rigorous" oversight of the construction process by the NRC, the Georgia PSC and Southern Company.
Collins said Georgia utility regulators had calculated building the two new units at Vogtle would cost about $2.2 billion less than the next-most-competitive fuel option over the life of the new units. Fuel costs accounted for a lot of that difference, she said, noting that uranium has been inexpensive and stable compared to natural gas and coal.
During the webcast, NRC Commissioner Ostendorff observed, "many in the utility industry in the U.S. and worldwide are watching the construction progress at the Vogtle and (Virgil C.) Summer plants to assess performance, schedule and budget before making any future decisions on new nuclear plants."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
"How we decide as a country what to do with spent nuclear fuel is critical to the future of nuclear power," Hoffman said in the September 20 webcast. Dozens of license renewals have been granted to existing nuclear generators. More than a dozen license extension applications are being considered by the U.S. Nuclear Regulatory Commission (NRC) (Bethesda, Maryland). And new nuclear plants are being built. But nuclear power's renaissance in the U.S. will be complicated by the continued inability to build a central spent fuel repository, she predicted.
"I may come off like the skunk at the garden party, but this is a problem that cannot be ignored," Hoffman continued. "We have over 70,000 metric tons of spent fuel at nuclear plants across the country, and that number will double by 2055." Left unresolved, spent nuclear fuel could be one factor that "dooms to failure" efforts to build new nuclear plants, she said.
"No one wants to see spent nuclear fuel lingering onsite for indefinite periods of time," she said in the webcast. "There are too many safety and environmental impacts." The costs of spent nuclear fuel management and disposal also must be reflected in the cost of electricity generated from nuclear power plants, she urged. Today, those costs are not reflected in electric rates. Rather, those costs are being absorbed by the U.S. Department of Energy (DoE) (Washington, D.C.), which also is responsible for creating a permanent repository for spent nuclear fuel.
Efforts to build a repository for spent nuclear fuel, under way for decades, received another setback recently when a federal court told the NRC it had to consider the environmental consequences of continuing the current practice of storing spent nuclear fuel at the sites of nuclear power plants. In 1987, Congress amended the Nuclear Waste Repository Act to designate Yucca Mountain, Nevada, as the nation's centralized site for spent nuclear fuel. But in the 25 years since that amendment was passed, litigation, political maneuvering and competing geologic assessments have prevented a single shovel of dirt from being turned at Yucca Mountain.
Meanwhile, the DoE has collected more than $25 billion to pay for handling spent nuclear waste, but that money sits unspent. "In the Vermont vernacular, that's as dumb as a stone," Hoffman commented. "We need to get beyond wishful thinking on spent nuclear fuel, or the industry really is doomed to failure. We need to create a new organization, separate from DoE, to implement a waste management strategy. There are many reasons why DoE has not succeeded, but it's time to move on."
Low-priced natural gas is another challenge facing potential new-build nuclear projects. "Can nuclear power compete with natural gas at today's prices, or will competition with gas be the true death knell for nuclear power?" Hoffman asked. Today's natural gas price of about $3 per million British thermal units (MMBtu) is less than half what it was a few years ago, when the nuclear industry was looking forward to building several new nuclear generators in the U.S. But since then, low gas prices have figured prominently in decisions to abandon several proposed new-build nuclear generators. Exelon Corporation (NYSE:EXC) (Chicago, Illinois) recently abandoned plans to build a two-unit merchant generator in Victoria, Texas. Other developers, including NRG Energy Incorporated (NYSE:NRG) (Houston, Texas) and Constellation Energy (Baltimore, Maryland), now part of Exelon, also abandoned new-build nuclear projects. For more on that, see April 22, 2011, article - NRG Energy Ends its Investment in South Texas Project Units 3 & 4, and October 15, 2010, article - Constellation Energy Exits Calvert Cliffs Unit 3, Stunning Industry and Potentially Slowing Nuclear Renaissance.
Hoffman and her co-panelists from the NRC and Southern Company (NYSE:SO) (Atlanta, Georgia) agreed that the consequences of the meltdown of the Fukushima Dai'Ichi nuclear plant in March 2011 is another issue that will shape the future of nuclear power in the U.S. "I agree that we cannot underestimate the impacts of Fukushima," NRC Commissioner William Ostendorff told the webcast. "The NRC has taken a very serious and thoughtful look at those issues over the last 18 months."
Cheri Collins, nuclear operations development, general manager and external affairs liaison for Southern Company, made this comment: "We are aware the world is watching" Southern's construction of units 3 and 4 at the Vogtle Nuclear Plant. "We are diligently focused on building a safe plant on schedule and on budget."
Collins vehemently and repeatedly denied that the new units at Vogtle are experiencing cost overruns: "There are no cost overruns. We have not asked the Georgia Public Service Commission to adjust its certified budget" of $14 billion for the two new units, which are scheduled to come online in 2016 and 2017. Low interest rates and falling commodity prices are helping keep down the cost of the project, she said. In addition, Southern has yet to finalize the terms of its $8.3 billion federal construction loan guarantee. For more information on that issue, see February 17, 2010, article - Obama Administration Commits $8 Billion in Loan Guarantees to Georgia Power's Vogtle Units 3 and 4.
The Southern Company executive also noted the Georgia PSC is allowing Southern subsidiary Georgia Power Company (Atlanta, Georgia) to begin charging its customers for the cost of building the new units, before construction is complete. This will lower the overall cost of the project compared to other states where utilities can only charge customers for a project once construction is complete and the regulators deem the project "used and useful."
"This is a complex project where there will be ebbs and flows," Collins said of the Vogtle construction project. She said there is "rigorous" oversight of the construction process by the NRC, the Georgia PSC and Southern Company.
Collins said Georgia utility regulators had calculated building the two new units at Vogtle would cost about $2.2 billion less than the next-most-competitive fuel option over the life of the new units. Fuel costs accounted for a lot of that difference, she said, noting that uranium has been inexpensive and stable compared to natural gas and coal.
During the webcast, NRC Commissioner Ostendorff observed, "many in the utility industry in the U.S. and worldwide are watching the construction progress at the Vogtle and (Virgil C.) Summer plants to assess performance, schedule and budget before making any future decisions on new nuclear plants."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
