Nuclear Power Primed for Comeback
Monday, October 8, 2007
CHEROKEE COUNTY, S.C. -- Two decades ago, after Duke Energy abandoned its partly built nuclear power reactors here, the site was sold and turned into a movie set. Director James Cameron used it to film "The Abyss," a 1989 movie about civilian divers who encounter aliens while trying to rescue a stricken nuclear submarine. Cameron filled the unused nuclear containment building with water and hauled a section of an oil rig, a tiny submarine and fiberglass rocks inside to make convincing underwater scenes.
Now there's a new twist in the plot: The nuclear power industry is trying to come back from its own abyss. With natural gas prices volatile and people anxious about climate change, the nuclear power industry is touting its technology as a way to meet the nation's growing energy needs without emitting more greenhouse gases. Over the next two years, the Nuclear Regulatory Commission expects applications to build as many as 32 new nuclear reactors.
Duke Energy could be among them. It reacquired the Cherokee County site and has been tearing down old buildings so it can ask the NRC to let it start all over again. On a hot mid-September afternoon, a giant wrecking hammer was prying huge chunks of concrete from the walls of the old containment facility. They dangled from steel reinforcing rods like stones tottering from the ruins of an ancient coliseum. Inside, the props for "The Abyss" lay covered with dust.
Other utilities and independent power companies are also laying the groundwork for a new wave of U.S. nuclear plants. On Sept. 24, NRG Energy filed the first full application for a new nuclear unit since the partial meltdown of Pennsylvania's Three Mile Island plant in 1979. Then the Tennessee Valley Authority approved plans to build two new reactors in northern Alabama, where it abandoned two mostly finished units in 1988 when electricity demand failed to meet forecasts. Earlier, Constellation Energy Group filed a partial license application to add a nuclear unit to its existing site in Calvert Cliffs, Md.
NRG Energy chief executive David W. Crane proclaimed "a new day for energy in America."
But there is still a lot of worry about the economics of nuclear power. Nuclear plants are hugely expensive to build; they have long lead times and a history of cost overruns. Bottlenecks loom for key components if more than a few plants are built. The price of uranium has soared in recent years. So has the cost of construction materials and skilled labor, which is in short supply. Politicians, environmentalists and business still can't decide how to dispose of radioactive waste.
"If I were an investor, I'd be squeamish," said Jim Harding, a consultant and former director of power-supply planning at Seattle City Light.
To ease financial concerns, the nuclear power industry has turned to Congress. Among the biggest reasons for renewed interest in nuclear power are the tax breaks, loan guarantees and other subsidies in the Energy Policy Act of 2005.
Those benefits were "the whole reason we started down this path," Crane said after filing NRG Energy's license application. "If it were not for the nuclear provisions in there, we would not have even started developing this plan two years ago."
For each nuclear plant seeking federal approval before the end of 2008, the act provides tax credits of up to $125 million for eight years, loan guarantees for up to 80 percent of a plant's cost, shared application costs and insurance that would cover the costs of regulatory delay.
Nuclear plants also receive other subsidies, including local tax breaks and limits on liability for catastrophic accidents.
Many utility executives, however, say they need more.