washingtonpost.com > Business > Local Business
Correction to This Article
Previous editions of this article in print and on the Web misstated the amount that the Nuclear Regulatory Commission estimates it will charge Constellation Energy Group to cover the cost of reviewing the company's application to build a third unit at a nuclear power plant in Calvert County. An NRC spokesman said the cost would be about $23 million, not $46 million, as he had indicated earlier. This version has been corrected.

Firm Applies To Expand Nuclear Plant In Maryland

The two existing reactors at the Calvert Cliffs nuclear facility in Lusby, Md., went into service in the 1970s.
The two existing reactors at the Calvert Cliffs nuclear facility in Lusby, Md., went into service in the 1970s. (By James A. Parcell -- The Washington Post)
By Steven Mufson
Washington Post Staff Writer
Tuesday, July 31, 2007

The first application to build a new U.S. nuclear power plant in three decades has been filed with the Nuclear Regulatory Commission, bumping a proposed third unit at a Calvert County site to the front of a list of reactors being considered by the nuclear power industry.

Constellation Energy Group of Baltimore has filed a partial application with the NRC, asking the commission to review environmental plans for a 1,600-megawatt reactor at the Calvert Cliffs site in Lusby, Md., that could cost $4 billion.

The filing marked another small step toward a resurgence of the nuclear power industry, bolstered by generous federal tax incentives and growing concern about the greenhouse gases emitted by coal-fired plants, which supply half the country's electricity. There has not been an application to build a nuclear power plant in the United States since before the partial meltdown at one of the Three Mile Island units in Pennsylvania in 1979.

"It's partial, but it's the first application to operate and build a new reactor that the NRC has received in about 30 years," NRC spokesman Scott Burnell said yesterday.

The existing pair of Calvert Cliffs reactors -- which went into service in 1975 and 1977 -- are the closest ones to the nation's capital, 50 miles southeast of the District.

Companies seeking to build nuclear plants can qualify for energy production tax credits and certain loan guarantees under the 2005 Energy Policy Act only if they get the NRC to accept construction permits before the end of 2008. Burnell said the NRC expects as many as 18 other nuclear power plant applications by then, though many critics of nuclear power say high costs and continuing problems with nuclear waste disposal will likely prevent most of them from being built.

So far, four other companies have asked for early site permits from the NRC, and two have been approved. But Constellation's environmental application -- filed July 13 and reported yesterday by Bloomberg News -- skips that step and represents a greater financial commitment. Once the NRC starts considering the application, the clock starts running on review costs, which could reach $23 million for the company, Burnell said. Constellation said application costs could eventually reach $100 million, part of which would be covered by the Energy Department to encourage development.

Construction of the plant would not be imminent, however. Constellation is expected to file the safety part of its application, with details about the reactor's design, early next year. The NRC technical review could last 2 1/2 years, followed by another year for hearings.

Constellation Senior Vice President George Vanderheyden said yesterday that the company had not made a final decision to go ahead with the plant. "No entity, including Constellation, has yet made a decision to build a nuclear power plant, but we're moving as aggressively as we can down the first phase, which is the licensing phase," Vanderheyden said.

However, he said, Constellation has been positioning itself to build a new fleet of standardized nuclear power plants for which the Calvert Cliffs unit would be a model.

"Perhaps the most significant contribution Constellation Energy can make would be to deploy the first standardized fleet of new nuclear power plants in almost three decades," Constellation chief executive Mayo A. Shattuck III said last week in an earnings release.

Electric utilities across the country have been inching ahead with plans for new nuclear plants. Thanks to concerns about emissions of global-warming gases, opposition has been mounting against coal-fired power plants. If Congress adopts legislation that would tax or limit carbon dioxide emissions, that would put another burden on coal plants and give an additional advantage to nuclear plants, which do not emit any greenhouse gases.

"It is another commitment by a utility to . . . nuclear in the context of constraints on fossil fuels and the increasing importance of reducing greenhouse-gas emissions," said John O'Neill, a lawyer with Pillsbury Winthrop Shaw Pittman who represents several companies in the nuclear-power business. "They have limited options, and they're making both an economic and a national-interest judgment."

Others disagree. "We're still in the phase where the utilities are testing the waters," said Edwin Lyman, a nuclear power expert at the Union of Concerned Scientists. "Until we see investors put money down toward the multibillion-dollar cost of building new plants, one should remain skeptical that there's any major shift underway."

Lyman added that the UCS opposes nuclear subsidies and maintains "that nuclear is not likely to be the lowest-cost way of mitigating greenhouse-gas emissions."

While many energy experts have criticized the size of federal incentives for nuclear power, Vanderheyden said more loan guarantees would be needed. He said the current ceiling on guarantees would be enough to cover the cost of no more than two plants. The nuclear power industry has been lobbying Congress to sharply increase the size of the loan-guarantee program as part of this year's energy bill.

To help deal with the financial burden of building the nuclear plants, Constellation has made an agreement with Electricite de France, which will make an initial investment of $350 million in a joint venture and invest up to $275 million later to develop nuclear plants in the United States and Canada. EDF could also acquire up to 9.9 percent of Constellation stock in the open market.

EDF is the largest electricity producer in Europe. It has operated 58 nuclear plants for more than 20 years.

© 2007 The Washington Post Company