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Released November 11, 2015 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The U.S. Nuclear Regulatory Commission (NRC) (Bethesda, Maryland) on October 22 awarded the Tennessee Valley Authority (NYSE:TVE) (TVA) (Knoxville, Tennessee) an operating license for Unit 2 of the Watts Bar Nuclear Power Station in Spring City, Tennessee. Watts Bar Unit 2, a pressurized water reactor (PWR) with about 1,150 megawatts (MW) of generating capacity, is the first U.S. nuclear power unit to be licensed by the NRC in 19 years. Prior to Watts Bar 2 getting its license, the most recently licensed nuclear power plant was Watts Bar Unit 1, which was licensed in 1996.
All told, Watts Bar Unit 2 cost between $6 billion and $6.1 billion to construct, TVA spokesperson Scott Brooks said in an interview.
Construction of the Watts Bar nuclear complex began in 1973, and by 1985, TVA had spent about $1.5 billion to build Unit 2, Brooks continued. Construction was suspended in 1988 when the plant was about 80% complete. Construction was restarted in 2007, when TVA estimated the cost to complete that unit would be about $1 billion. By mid-2007, the estimated completion cost had risen to about $2.5 billion.
In April 2012, the revised completion cost was estimated to be between $4.2 billion and $4.5 billion; the final cost to complete Unit 2 was in that range, Brooks told Industrial Info. For more on the construction of Watts Bar Unit 2, see September 29, 2011, article - Completion Date Slips for TVA's Watts Bar Unit 2, and March 11, 2009, article - Tennessee Valley Authority on Schedule and on Budget for 1,220-Megawatt Nuclear Unit at Watts Bar Plant.
TVA's Brooks said the plant will begin generating electricity sometime in early 2016. Minor works need to be completed before fuel can be loaded. After that, TVA will conduct several months of power ascension testing.
"This achievement signifies more than a stage in construction for TVA," said Bill Johnson, TVA's president and chief executive, in an October 22 statement. "It demonstrates to the people of the Valley that we have taken every step possible to deliver low cost, carbon-free electricity safely and with the highest quality."
"Completing Watts Bar Unit 2 was a sound business decision made for the long-term good of the Tennessee Valley," he continued. "The unit is essential to diversifying TVA's power sources to assure the more than 9 million people served by TVA and its local power company partners have affordable and reliable electricity generated in an environmentally friendly manner."
At the height of construction, more than 3,500 people were working on Watts Bar Unit 2. TVA said Crews reached more than 33 million work hours without a lost-time accident, reflecting the importance of safety and quality on the project.
"Completing Watts Bar Unit 2 and successfully licensing one of the nation's largest new nuclear generation projects is a historic milestone for TVA and the nuclear industry," said TVA Chief Nuclear Officer Joe Grimes on October 22. "With the delivery of this unit, we are further positioning nuclear power as a key player in TVA's--and the nation's--energy portfolio, and instilling confidence in TVA and the nuclear industry."
In the U.S., four other nuclear units remain under construction: Two at the Alvin W. Vogtle Nuclear Power Station in Waynesboro, Georgia, and two at the Virgil C. Summer Nuclear Power Station in Jenkinsville, South Carolina. Both have been plagued by cost overruns, project delays and disputes with contractors. When completed, the Vogtle unit additions will add a total 2,234 MW of new generating capacity, while the Summer unit additions will add about 2,200 MW.
Georgia Power Company (Atlanta, Georgia), the operator and lead owner of the Vogtle unit additions, originally estimated it would cost about $2 billion to build one new unit at Vogtle and that unit would be operating by mid-2015. However, in 2008, the utility added a second unit and said the estimated cost to build both was $12 billion. At that time, the in-service date of the first new unit was pushed back to mid-2016, and the second unit was supposed to be operating by mid-2017. As of mid-2015, the cost to build Vogtle units 3 and 4 had increased to $15 billion, and the start dates had been pushed back to late 2019 for the first new unit and late 2020 for the second new unit. Georgia Power is a unit of Southern Company (NYSE:SO) (Atlanta, Georgia).
South Carolina Electric & Gas Company (SCE&G) (Cayce, South Carolina), a unit of SCANA Corporation (NYSE:SCG) (Cayce, South Carolina), is the operator and majority owner for the two-unit expansion of the Summer nuclear plant in South Carolina. When first announced a decade ago, SCE&G planned to build only one new unit at Summer, at a cost of about $2 billion. Back then, the scheduled in-service date was supposed to be July 2015. But in 2009, the utility added a second unit, and the cost rose to about $15 billion for the two units, with scheduled in-service dates of 2016 and 2019. The current projected date of operation for the two new units is mid-2019 and mid-2020.
Years ago, when the U.S. Environmental Protection Agency (EPA) (Washington, D.C.) started issuing tougher environmental regulations for power plants, the nuclear industry touted the pollution-free benefits of nuclear power (aside from the still-unresolved issue of nuclear waste). But ultimately, as costs soared and projects experienced lengthy construction delays, nuclear power became a "bet the company" proposition, causing other developers to delay or cancel their projects.
Watts Bar's 1,150 MW of new generation comes at a price of about $5.2 million per installed megawatt of capacity. The Vogtle and Summer unit expansions will cost about $6.8 million per installed MW of capacity. Those figures are five to six times the cost of building a gas-fired, high-efficiency, combined-cycle generator.
"Completion of Watts Bar Unit 2 is a milestone that TVA and the industry rightly celebrates," said Britt Burt, Industrial Info's vice president of research for the global power industry. "But we don't see any new nuclear plants being built in the next five years. The cost is prohibitive--at least twice the cost of a new coal-fired unit with pollution controls and carbon-capture equipment. While regulators and utilities rightly value fuel diversity, building a new nuclear unit has become so expansive that it can't be justified. Whether the hiatus in constructing full-scale nuclear units makes small modular reactors (SMRs) more attractive remains an open question."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, 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.
All told, Watts Bar Unit 2 cost between $6 billion and $6.1 billion to construct, TVA spokesperson Scott Brooks said in an interview.
Construction of the Watts Bar nuclear complex began in 1973, and by 1985, TVA had spent about $1.5 billion to build Unit 2, Brooks continued. Construction was suspended in 1988 when the plant was about 80% complete. Construction was restarted in 2007, when TVA estimated the cost to complete that unit would be about $1 billion. By mid-2007, the estimated completion cost had risen to about $2.5 billion.
In April 2012, the revised completion cost was estimated to be between $4.2 billion and $4.5 billion; the final cost to complete Unit 2 was in that range, Brooks told Industrial Info. For more on the construction of Watts Bar Unit 2, see September 29, 2011, article - Completion Date Slips for TVA's Watts Bar Unit 2, and March 11, 2009, article - Tennessee Valley Authority on Schedule and on Budget for 1,220-Megawatt Nuclear Unit at Watts Bar Plant.
TVA's Brooks said the plant will begin generating electricity sometime in early 2016. Minor works need to be completed before fuel can be loaded. After that, TVA will conduct several months of power ascension testing.
"This achievement signifies more than a stage in construction for TVA," said Bill Johnson, TVA's president and chief executive, in an October 22 statement. "It demonstrates to the people of the Valley that we have taken every step possible to deliver low cost, carbon-free electricity safely and with the highest quality."
"Completing Watts Bar Unit 2 was a sound business decision made for the long-term good of the Tennessee Valley," he continued. "The unit is essential to diversifying TVA's power sources to assure the more than 9 million people served by TVA and its local power company partners have affordable and reliable electricity generated in an environmentally friendly manner."
At the height of construction, more than 3,500 people were working on Watts Bar Unit 2. TVA said Crews reached more than 33 million work hours without a lost-time accident, reflecting the importance of safety and quality on the project.
"Completing Watts Bar Unit 2 and successfully licensing one of the nation's largest new nuclear generation projects is a historic milestone for TVA and the nuclear industry," said TVA Chief Nuclear Officer Joe Grimes on October 22. "With the delivery of this unit, we are further positioning nuclear power as a key player in TVA's--and the nation's--energy portfolio, and instilling confidence in TVA and the nuclear industry."
In the U.S., four other nuclear units remain under construction: Two at the Alvin W. Vogtle Nuclear Power Station in Waynesboro, Georgia, and two at the Virgil C. Summer Nuclear Power Station in Jenkinsville, South Carolina. Both have been plagued by cost overruns, project delays and disputes with contractors. When completed, the Vogtle unit additions will add a total 2,234 MW of new generating capacity, while the Summer unit additions will add about 2,200 MW.
Georgia Power Company (Atlanta, Georgia), the operator and lead owner of the Vogtle unit additions, originally estimated it would cost about $2 billion to build one new unit at Vogtle and that unit would be operating by mid-2015. However, in 2008, the utility added a second unit and said the estimated cost to build both was $12 billion. At that time, the in-service date of the first new unit was pushed back to mid-2016, and the second unit was supposed to be operating by mid-2017. As of mid-2015, the cost to build Vogtle units 3 and 4 had increased to $15 billion, and the start dates had been pushed back to late 2019 for the first new unit and late 2020 for the second new unit. Georgia Power is a unit of Southern Company (NYSE:SO) (Atlanta, Georgia).
South Carolina Electric & Gas Company (SCE&G) (Cayce, South Carolina), a unit of SCANA Corporation (NYSE:SCG) (Cayce, South Carolina), is the operator and majority owner for the two-unit expansion of the Summer nuclear plant in South Carolina. When first announced a decade ago, SCE&G planned to build only one new unit at Summer, at a cost of about $2 billion. Back then, the scheduled in-service date was supposed to be July 2015. But in 2009, the utility added a second unit, and the cost rose to about $15 billion for the two units, with scheduled in-service dates of 2016 and 2019. The current projected date of operation for the two new units is mid-2019 and mid-2020.
Years ago, when the U.S. Environmental Protection Agency (EPA) (Washington, D.C.) started issuing tougher environmental regulations for power plants, the nuclear industry touted the pollution-free benefits of nuclear power (aside from the still-unresolved issue of nuclear waste). But ultimately, as costs soared and projects experienced lengthy construction delays, nuclear power became a "bet the company" proposition, causing other developers to delay or cancel their projects.
Watts Bar's 1,150 MW of new generation comes at a price of about $5.2 million per installed megawatt of capacity. The Vogtle and Summer unit expansions will cost about $6.8 million per installed MW of capacity. Those figures are five to six times the cost of building a gas-fired, high-efficiency, combined-cycle generator.
"Completion of Watts Bar Unit 2 is a milestone that TVA and the industry rightly celebrates," said Britt Burt, Industrial Info's vice president of research for the global power industry. "But we don't see any new nuclear plants being built in the next five years. The cost is prohibitive--at least twice the cost of a new coal-fired unit with pollution controls and carbon-capture equipment. While regulators and utilities rightly value fuel diversity, building a new nuclear unit has become so expansive that it can't be justified. Whether the hiatus in constructing full-scale nuclear units makes small modular reactors (SMRs) more attractive remains an open question."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, 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.
