Despite much fanfare about the so-called nuclear “renaissance” over the past several years, not much has actually materialized. In fact, the last couple of weeks have proven particularly challenging to the renaissance myth, as several decisions were made to cancel proposed new reactor projects and shut down existing reactors. Let’s take a look at how it’s all crumbling.
June didn’t start off well for the industry. Warren Buffet’s MidAmerican Energy announced that they are not going to build new nuclear plants in Iowa right now and will instead focus on a $1.9 billion wind project. They were initially considering small modular reactors, similar to those that are currently being pursued by the Tennessee Valley Authority (TVA).
Then on June 7, California Edison announced that it would be shuttering the San Onofre reactors in California due to serious safety issues with a steam generator replacement. The announcement came just two days after an historic event that included Japan’s former Prime Minister Naoto Kan, former U.S. Nuclear Regulatory Commission (NRC) Chair Gregory Jaczko (both of whom were in office during Japan’s Fukushima nuclear disaster in 2011), nuclear engineer Arnie Gundersen and Peter Bradford, a former NRC Commissioner during the Three Mile Island accident. These distinguished speakers comprised a panel that focused on lessons learned from Fukushima, organized in part by Friends of the Earth. During the event, Kan said that though he once supported nuclear energy, the Fukushima nuclear accident made him ashamed of his previous position. You can view the captivating event in several Youtube videos that are posted here.
Then Exelon, the largest nuclear utility in the country, announced that it was canceling plans to increase output at its two Limerick reactors in Pennsylvania and two LaSalle reactors in Illinois, citing cheap wind as the reason.
TVA also made a big announcement last week that it was slowing work at the Bellefonte nuclear reactor in Alabama and cutting nearly 75% of the workforce. TVA cited the struggling economy and reduced need for electricity.
As all of this happened only halfway through June, I am beginning to think we can safely call this a trend. New reactor projects are being canceled and old reactors are showing signs of degradation and wear that make them uneconomic to fix. Reviewing the past year’s history of nuclear energy in the United States also supports this relapse trend:
- Activists and watchdogs of the Davis-Besse reactor in Ohio are already gearing up to prove that this much plagued plant has the same safety concerns that forced San Onofre to close.
- In New Jersey last week, the Hope Creek nuclear reactor was manually shut down after one of the three water pumps that circulates cooling water failed.
- In May, Duke Energy suspended its proposed expansion at Shearon Harris in North Carolina, blaming the slow economy and lack of need for increased power generation.
- Also in May, the Palisades nuclear reactor in Michigan was shut down for the sixth time since 2012 for radioactive leaks.
- May also saw the operating reactor at Shearon Harris in North Carolina shut down for a crack that was discovered in a reactor sensor. The reactor was scanned a year before, but somehow the crack was missed upon initial analysis of the scans. The reactors were restarted in early June; the cost of the shutdown is estimated between $10-20 million.
- Earlier this year, in March, a tragic heavy equipment accident at the Arkansas One Unit 1 nuclear reactor killed one and injured several others. Unit 2 was restarted in May, but Unit 1 is still offline, pending regulatory oversight and investigations.
- In February, Duke Energy announced it would shutter the long ailing Crystal River reactor in Florida that Progress Energy (the former owner) had botched in a DIY uprate project in 2009.
- Going a little further back to October of 2012, Dominion Power announced that it would shutter its Kewaunee nuclear reactor in Wisconsin because it was no longer economically feasible to operate. The reactor stopped generating power on May 7, 2013.
- In August of 2012, the NRC licensing board denied the license for the proposed new reactor at Calvert Cliffs in Maryland due to the project being owned by a foreign entity. Initially, Constellation Energy was the primary owner of the project, but they pulled out suddenly in 2010 right after $7.5 billion in loan guarantees were offered by the Department of Energy. You can read more about that story here.
Meanwhile, it is being said that the future of the industry depends largely on the Vogtle project in Georgia, and, of course, the price of natural gas. We know that the Vogtle project is delayed and hundreds of millions of dollars over budget already and credit agencies are paying close attention. The S&P just lowered its outlook on the mighty Southern Company for a bungled new power plant project in Mississippi. Similarly, the V.C. Summer project in South Carolina recently pushed their operation date back a year, which added about $200 million to the price tag. And unfortunately many Georgians and South Carolinians have already been paying for these reactors through their monthly power bills for a couple of years due to anti-consumer state legislation that allows utilities to charge their customers in advance for certain costs associated with pursuing new reactors.
The only other projects considered viable by the industry at this time are in Florida at Levy County and Turkey Point, though costs have skyrocketed to estimates of more than $40 billion combined and the timelines have been pushed back significantly from first estimates. Despite no commitment to build, customers in Florida are on the hook for the proposed reactors through similar “nuclear tax” legislation as in Georgia and South Carolina, which unfairly allows utilities to charge their customers in advance. Fortunately, Florida Governor Rick Scott just signed into law a bill, passed by the state legislature
in May, that attempts to fix the nuclear tax scheme and provide a modest level of consumer protections — yet another blow to the nuclear industry.
Despite being propped up by federal and consumer-funded subsidies, the nuclear energy industry is flailing. The renaissance that never was is rapidly becoming never more. Yet many larger, backwards thinking utilities are reluctant to face reality and embrace new opportunities from energy efficiency, renewable energy sources and integrated resource planning models. Instead, they cling to large, centralized energy production comprised of risky, expensive nuclear power and dirty fossil fuels. It’s high time these utility monopolies get with the program before they become as obsolete as their energy portfolios.