New Day for Nuclear Generation
NRC Grants Approval to Southern
It’s a new day for nuclear generation. Now that the Nuclear Regulatory Commission has granted approval to Southern Co. and its subsidiary Georgia Power to build two new units, the conglomerate says it will be ready to produce power in 2016-17.
That’s the plan, at least. To get there, it needs to first fend off some expected lawsuits as well as demonstrate that it can stay on time and on budget -- something that has hampered nuclear construction in this country since 1978 when the NRC last approved such a project.
Southern’s Chief Executive Tom Fanning is emphasizing that his utility is “committed to bringing these units online to deliver clean, safe and reliable energy to our customers. The project is on track, and our targets related to cost and schedule are achievable.” The two units would be add up to 2,000 megawatts.
The NRC’s 4-to-1 decision allows Southern to build the reactors at an existing nuclear site near Augusta. It will use the latest technologies available, called the Westinghouse AP 1000. The NRC unanimously approved that design in December, which it said is equipped with the redundant safety features to shut down automatically in case of a radioactive leak.
That said, the NRC Chair Gregory Jaczko was the lone hold-out with respect to granting approval to Southern. In the aftermath of the Japanese accident, the NRC is requiring that the nation’s 104 reactors go through new safety checks that include ensuring that they would have prolonged back-up power in emergencies. Such reserves would kick in to keep the spent fuel rods cool so as to prevent a meltdown -- a critical failing in the case of Japan’s Fukushima crisis.
Others, though, point out that the nuclear industry is already at work guaranteeing the safety of its operating units. The planning and licensing process associated with Southern’s venture has taken 7 years and by all accounts, it has been thorough.
“Despite the newest technology being used, and despite substantial differences in location and risk when compared to the Fukushima plant, the chairman opposed action,” says Scott Segal, director of the Electric Reliability Coordinating Council “Frankly, it leads us to wonder if any nuclear advancement will be good enough for the Chairman, and whether he is truly committed to the Administration’s ‘all of the above’ strategy.”
Opponents will Fight
Opponents of the new nuclear endeavors say that their fight will continue -- this time in U.S. District Court in Washington. There, they will argue that the industry has not adequately shown it has done enough to improve safety at its plants. Such groups as Public Citizen, Greenpeace and the Southern Alliance for Clean Energy are also concerned about the projected costs of those would-be units and who exactly would have to pay for them if they are not on budgetary track.
The value of the project is estimated to be $14 billion. Of that, about $6 billion would fall on the utility. The rest would come from loan guarantees issued to Southern and its partners. Southern’s two reactors are to be constructed on its “Vogtle” site that already has two other reactors. Those existing units were $8 billion over budget and took 16 years to build.
However, if Southern can pay off its government loan, then it would encourage others to tread. That, in turn, would help attract private financiers, who are now skeptical of nuclear deals given their previous histories.
“The conditional loan guarantee extended to the Vogtle plant was initiated by the Bush administration and finalized under the Obama administration, which is indicative of the bipartisan commitment to addressing market barriers to deployment of nuclear energy technologies,” says Pete Domenici, who is now with Bipartisan Policy Center and who is a former Republican Senator from New Mexico.
In 2009, the U.S. Department of Energy identified four nuclear projects that it said qualified for loan guarantees. For now, there’s the twin facilities that Southern Co. is proffering and there’s two more that SCANA Corp's South Carolina Electric & Gas Co. is proposing, also expected to be 1,000 megawatts eac. Progress Energy, meantime, wants to build a plant in Florida using the Westinghouse AP technology, although that utility is way off of its projected budget.
Indeed, that’s the bigger cause for alarm, not withstanding the timing of all this hoopla less than a year after Japan’s nuclear accident. Southern’s success, though, would enhance a generation asset that is now widely operating near capacity and that has long been dependable.
EnergyBiz Insider is the Winner of the 2011 Online Column category awarded by Media Industry News, MIN. Ken Silverstein has also been named one of the Top Economics Journalists by Wall Street Economists.
Follow Ken on www.twitter.com/ken_silverstein
energybizinsider@energycentral.com
