Nu­clear sees power wane

Soar­ing costs and cheap nat­u­ral gas have dealt more set­backs to the in­dus­try

Los Angeles Times - - MONDAY BUSINESS - By Rob Nikolewski rob.nikolewski@sdunion­tri­

The nu­clear en­ergy in­dus­try has had a bad cou­ple of weeks.

On July 31, util­i­ties in South Carolina an­nounced that they are stop­ping work on two new re­ac­tors at the V.C. Sum­mer Nu­clear Gen­er­at­ing Sta­tion, say­ing cost es­ti­mates came to more than $20 bil­lion, al­most twice what was ex­pected. About $9 bil­lion has al­ready been spent on the project since 2008.

Then, two days later, de­vel­op­ers of an­other nu­clear project in the South — the Vog­tle Elec­tric Gen­er­at­ing Plant in Ge­or­gia — an­nounced costs had swelled from $14 bil­lion to more than $25 bil­lion and pre­dicted com­ple­tion will be de­layed an ad­di­tional 18 months.

The two an­nounce­ments come at a par­tic­u­larly bad time for the in­dus­try. No nu­clear power plant has been built in the United States for 30 years, the na­tion’s fleet of 99 re­ac­tors is get­ting older and 10 ex­ist­ing plants have an­nounced plans to shut down in the com­ing years, in­clud­ing Di­ablo Canyon, the last re­main­ing nu­clear plant in Cal­i­for­nia.

And in March, West­ing­house Elec­tric Co., long con­sid­ered the leader in nu­clear power de­vel­op­ment, filed for bank­ruptcy pro­tec­tion.

Then there is nu­clear’s prob­lem when it comes to com­pet­ing with nat­u­ral gas.

Driven by de­vel­op­ments in hy­draulic frac­tur­ing and hor­i­zon­tal drilling tech­niques, oil and gas pro­duc­ers in sites such as the Mar­cel­lus shale for­ma­tion have dra­mat­i­cally in­creased the amount of nat­u­ral gas across the U.S.

The abun­dance has driven down prices, and util­i­ties have in­creas­ingly turned to nat­u­ral gas as an al­ter­na­tive to nu­clear, as well as coal.

“I think what hap­pened to the op­er­at­ing plants is the price of nat­u­ral gas fell to lev­els that no one had ever pre­dicted,” said Jay Sil­berg, a nu­clear en­ergy lawyer and part­ner at the Wash­ing­ton law firm of Pills­bury Winthrop Shaw Pittman.

An­other fac­tor is the in­creas­ing amount of re­new­able en­ergy on the grid.

“It doesn’t sur­prise me at all that these plants are get­ting can­celed,” said Rochelle Becker, a long­time critic of nu­clear power and ex­ec­u­tive di­rec­tor of Al­liance for Nu­clear Re­spon­si­bil­ity in San Luis Obispo.

“They’re like very ex­pen­sive domi­noes that are fall­ing .... With the price of nat­u­ral gas and the avail­abil­ity of re­new­able and new sources that are con­tin­u­ing to hit the mar­ket, nu­clear is pretty much dead in this coun­try.”

Ac­cord­ing to the most re­cent num­bers by the Cal­i­for­nia En­ergy Com­mis­sion, re­new­able en­ergy made up 27.9% of in-state gen­er­a­tion of elec­tric­ity in 2016, al­most twice as much as in 2009.

In ad­di­tion, Cal­i­for­nia is one of 28 states that have in­sti­tuted Re­new­able Port­fo­lio Stan­dards (RPS), man­dat­ing util­i­ties to in­clude in­creas­ing amounts of cleanen­ergy sources such as wind and so­lar in their grids.

The most re­cent it­er­a­tion of Cal­i­for­nia’s RPS calls for the state to de­rive 50% of its elec­tric­ity from sources that do not emit car­bon by 2030, and there’s a bill in the Leg­is­la­ture this ses­sion that would take the tar­get all the way to 100% by 2045.

Like most states, Cal­i­for­nia does not clas­sify nu­clear as part of its clean-en­ergy port­fo­lio.

An­other stum­bling block is the ra­dioac­tive waste that ac­com­pa­nies nu­clear power plants.

Even though the San Onofre Nu­clear Gen­er­at­ing Sta­tion has not pro­duced elec­tric­ity for more than five years, 3.55 mil­lion pounds of spent nu­clear fuel re­mains at the plant within sight of the Pa­cific Ocean.

As seen at nu­clear sites across the coun­try, San Onofre waste has been stranded be­cause the fed­eral govern­ment has not ful­filled its prom­ise to com­plete a stor­age fa­cil­ity where nu­clear waste can be de­posited.

But nu­clear en­ergy still has its sup­port­ers.

The projects in Ge­or­gia and South Carolina each adopted an ad­vanced re­ac­tor de­sign called AP1000 de­vel­oped by West­ing­house. Though the de­sign has its share of crit­ics, a for­mer pres­i­dent of the Amer­i­can Nu­clear So­ci­ety de­fended it.

“The AP1000 is an ex­cel­lent tech­nol­ogy,” said Ted Quinn, who runs a con­sult­ing firm in Dana Point. “In the area of tech­nol­ogy, we’re good. In the area of con­struc­tion prac­tices, it’s a com­bi­na­tion of the work­force and the type of con­tracts that are writ­ten. We’re chal­lenged in that area.”

Quinn and oth­ers say nu­clear en­ergy needs to be re­tained be­cause of its abil­ity to en­sure re­li­able base load power for the grid, and they main­tain that the in­dus­try’s abil­ity to gen­er­ate large amounts of en­ergy with­out emit­ting green­house gases makes it es­sen­tial in reach­ing tar­gets to re­duce global warm­ing.

“With­out an ag­gres­sive build­out of nu­clear power, cli­mate goals are still at­tain­able, but at much greater ex­pense,” Jef­frey Sachs, di­rec­tor of Sus­tain­able De­vel­op­ment So­lu­tions Net­work, told Bloomberg News. “We’d make a big mis­take if we de­cide right now we don’t need it.”

A re­port from En­vi­ron­men­tal Progress, a pro-nu­clear en­vi­ron­men­tal group in Berke­ley, said Cal­i­for­nia’s power-sec­tor emis­sions are 21⁄2 times higher to­day than they would have been had the state kept open and built planned nu­clear plants.

Be­fore San Onofre was shut down, nu­clear power ac­counted for 18% of Cal­i­for­nia’s in-state gen­er­a­tion. Since it has been closed, the fig­ure dropped to 9%, with Di­ablo Canyon as the only nu­clear plant left. Nat­u­ral gas’ con­tri­bu­tion to the mix — and that of re­new­ables — has gone up.

The Brat­tle Group, an in­ter­na­tional con­sult­ing com­pany, came out with a study in De­cem­ber 2016 that said pre­ma­ture re­tire­ments of nu­clear plants could in­crease green­house gas emis­sions. Its re­search showed that re­duc­tions made to­day have more ef­fect than those made in the fu­ture.

“Since CO2 emis­sions per­sist for many years in the at­mos­phere, near-term emis­sion re­duc­tions are more help­ful for cli­mate pro­tec­tion than later ones,” the study said. “Thus, pre­serv­ing ex­ist­ing nu­clear plants will im­prove the ef­fec­tive­ness of any cli­mate pol­icy ap­proach, by hold­ing down cu­mu­la­tive emis­sions.”

But Becker said nu­clear’s waste is­sues blunt that ar­gu­ment.

“For 60 years we haven’t been able to find a so­lu­tion to the waste that’s left be­hind at these nu­clear plants,” she said. “What you have is very ex­pen­sive back­end costs. In fact, the back­end costs can be as large as the front-end costs.”

The nu­clear in­dus­try sees prom­ise in a new gen­er­a­tion of plants, in­clud­ing “small mod­u­lar re­ac­tors” (SMRs) that take up a frac­tion of the space of cur­rent fa­cil­i­ties and can be used in a mul­ti­tude of lo­ca­tions, in­clud­ing re­mote sites.

San Diego-based Gen­eral Atomics has been work­ing on what’s called the En­ergy Mul­ti­plier Mod­ule. But no SMRs are on­line yet. Gen­eral Atomics hopes to have its project ready in 2030.

In­ter­na­tion­ally, the fore­cast is mixed. Rus­sia and China are build­ing nu­clear projects, with China ex­pected to com­plete five new plants this year alone.

But Ger­many swore off nu­clear power af­ter the Fukushima dis­as­ter in Ja­pan, and two coun­tries that have em­braced nu­clear in the past may be mak­ing an about-face.

The en­vi­ron­ment min­is­ter in France said last month that the coun­try may close up to 17 re­ac­tors to re­duce its re­liance on nu­clear power and boost its amount of re­new­able en­ergy, and South Korea just elected a new pres­i­dent who has promised to deem­pha­size nu­clear power.

“We will abol­ish our nu­clear-cen­tered en­ergy pol­icy and move to­ward a nu­cle­ar­free era,” Moon Jae-In said in June.

For its crit­ics, nu­clear is be­com­ing yes­ter­day’s news.

“The fu­ture is not big, base-load plants,” Becker said. “It’s dis­trib­uted gen­er­a­tion and re­new­able and other en­ergy that is on the ta­ble that we haven’t even talked about.”

But nu­clear’s sup­port­ers see a brighter fu­ture, even if the present is prob­lem­atic.

“I don’t think we’ll see large nu­clear power plants in the near fu­ture,” Sil­berg said. “We may see SMRs if they in fact get de­signed and li­censed. But I don’t think at this point in the next 15 or 20 years util­ity man­age­ment is go­ing to want to in­vest very much in a large nu­clear plant project, un­less of course nat­u­ral gas prices go back up and the in­dus­try fig­ures out how to over­come the prob­lems that showed up at Vog­tle and Sum­mer.”

John Bazemore As­so­ci­ated Press

DE­VEL­OP­ERS of the Vog­tle nu­clear project in Ge­or­gia an­nounced costs had swelled to more than $25 bil­lion and pre­dicted com­ple­tion will be de­layed 18 more months.

Erik S. Lesser Euro­pean Pressphoto Agency

A CON­STRUC­TION ve­hi­cle at the Vog­tle plant. On July 31, util­i­ties in nearby South Carolina an­nounced that they are stop­ping work on two new re­ac­tors.

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