Tue, Feb

Nuclear Power Makes a Comeback

Decades after it was written off as a costly failure, the nuclear power industry is being revived with plans for new reactors in Illinois and other states. Utilities are considering building or restarting up to eight reactors in Mississippi, South Carolina, Alabama, Virginia, and Idaho, as well as in Illinois.

Decades after it was written off as a costly failure, the nuclear power industry is being revived with plans for new reactors in Illinois and other states.

Utilities are considering building or restarting up to eight reactors in Mississippi, South Carolina, Alabama, Virginia, and Idaho, as well as in Illinois.

The renewed interest is an about-face for an industry that has not had an order for a new nuclear plant in 30 years. In recent years it was almost a given that nuclear plants were too expensive to build, too difficult to operate and their radioactive waste too hot to handle.

That view is changing as Chicago-based Exelon Corp. and other big power companies consider a new generation of cheap, efficient reactors that would produce plenty of power without generating the greenhouse gases of fossil-fuel plants.

It's a logical next step, said John Rowe, chief executive of Exelon, the nation's largest nuclear operator, with 17 reactors in Illinois, Pennsylvania and New Jersey.


"I am not starting a new crusade, he said in an interview Wednesday. "The nation needs this technology very badly."

Nuclear industry advocates and critics agree on almost nothing, but both sides say that if nuclear power is to return, a major taxpayer subsidy will be necessary. In its so-far-unsuccessful efforts to pass an energy bill, the Bush administration has proposed subsidizing construction of new plants, and some in the industry are pressing for loan guarantees of up to 80 percent of the cost of construction, contending that commercial lenders remain too wary.

Officials say it is impossible to determine now how much money the industry would need to build even a handful of new facilities. Exelon's plant at Zion cost $2 billion, adjusted for inflation, when it was built in 1973, and critics say the money could be better spent developing renewable energy sources such as wind power and clean-coal technology.

"The nuclear industry is asking for huge subsidies, corporate welfare, for unproven technology," said Howard Learner, executive director of the Chicago-based Environmental Law and Policy Center, which is trying to block construction of a new nuclear plant in Clinton, Ill., about 20 miles south of Bloomington.

Nuclear power was an incandescent issue for years beginning in the late 1960s. Activists nationwide opposed construction of nuclear plants. The country had no place to permanently store the radioactive waste produced by the plants--it still doesn't--which poses a dire threat to the public, opponents contend.

After near-disaster at Three Mile Island in 1979 and the 1986 catastrophe at Chernobyl, support for nuclear power evaporated.

"What the public thought was that the nuclear industry was being phased out," said Michele Boyd, legislative director of Public Citizen, which is among groups trying to block construction of new plants.

But with encouragement from the Bush administration and the likelihood of subsidies, utilities are again considering nuclear power.

Exelon, corporate parent of Commonwealth Edison, is in the earliest stages of seeking regulatory approval for the new reactor in Clinton, where an older nuclear plant has operated since 1987.

The company has not committed to the project and says it is unlikely to build a nuclear plant on its own anytime soon, though it is part of a consortium of companies that intends to build a new plant on a still-to-be-determined site.

Meanwhile, Entergy Corp. of New Orleans is looking at building a nuclear plant near Port Gibson, Miss., and Dominion Resources Inc., a utility based in Richmond, Va., is considering building a plant near the Virginia community of Mineral.

Most of the proposals involve adding reactors to existing nuclear plant sites, but the consortium that includes Exelon is looking for two new sites to build plants. The consortium, called Nustart, plans to seek licensing for a new plant in 2008, with construction starting in 2010.

"One of the sites we are looking at is the Savannah River [nuclear] site in South Carolina," said Dan Keuter, vice president of nuclear business development for Entergy, a member of the consortium.

He said another potential site is the Idaho National Engineering and Environmental Laboratory near Idaho Falls. The Energy Department controls both properties.

Illinois has more experience with nuclear power than any other state, though much of it was bad.

Commonwealth Edison's nuclear plants spent years on a Nuclear Regulatory Commission watch list because of their chronic safety problems. The plants were subject to frequent cost overruns and fines, and were often shut down for months at a time for repairs.

In 1998, for example, the utility permanently closed its two-reactor Zion plant on the shore of Lake Michigan north of Chicago. Executives concluded they simply would never be able to operate the plant properly. The plant potentially could have generated electricity until 2033.

Exelon's Rowe candidly agrees that the company's nuclear fleet suffered colossal cost overruns. He estimates the company lost between $5 billion and $10 billion building and operating its reactors.

David Kolata, director of policy for the Citizens Utility Board, said the cost of nuclear power in Illinois was spread across the state.

"The ratepayers ate some of it and ComEd ate some of it," he said. "Certainly, consumers paid more than they should have."

Nuclear power advocates make clear that the electric power industry will not pay for new plants. They say the government must subsidize construction costs.

"The financial risk is considered too high," said Carl Crawford, a spokesman for Entergy. "It's just too great a risk for any single company."

Nustart has already won a commitment of $260 million from the Energy Department to complete plant design, said Marilyn Kray, president of the consortium and an Exelon executive. "Our original request was for $400 million," Kray said.

She said the industry needs a subsidy for the first nuclear plants it builds, but would not require taxpayer assistance for the plants that would follow.

Adding to the uncertainty of the cost of a new plant is the distinct possibility of cost overruns. For example, CUB said the existing Clinton nuclear plant was supposed to cost $430 million, but it wound up costing 10 times that much.

Exelon has shown that nuclear plants can be made to run right, however. Over the past five years it has turned some of the nation's worst, least reliable plants into some of the best.

But critics of nuclear power say new reactors have a learning curve. Just as it took decades to learn how to properly run existing plants, they argue, it will take an unacceptably long time to learn how to operate new plants.

The NRC has approved three new reactor designs and is close to approving a fourth. "These are unproven designs," said Paul Gunter, with the Nuclear Information and Resource Service. "They have no track record in terms of cost or safety."

The NRC says the new reactors are cheaper to build, simpler to operate and include safety systems more reliable than reactor designs of the past.

Questions remain, however, about the need for new plants. Nuclear power will not reduce the nation's dependence on imported petroleum. Very little oil is used to produce electricity.

Instead, half the nation's power comes from coal. Nuclear supplies 20 percent, natural gas 17 percent, and most of the remainder comes from dams or renewable sources.

Nor will there be any shortage of electricity in the near future. The U.S. can produce as much as 30 percent more electricity than it currently consumes.

Source: Knight Ridder/Tribune Business News