TVA board backs plan to restart reactor

TVA board backs plan to restart reactor

BY DAVE FLESSNER
BUSINESS EDITOR

The Tennessee Valley Authority is using a new approach to revive its oldest nuclear reactor for less money.

The federal utility, which suffered from delays and cost overruns with its own nuclear construction and repair programs in the 1970s and 1980s, awarded a contract Tuesday for an outside contractor to oversee construction repairs at the oldest unit at the Browns Ferry Nuclear Plant.

During a board meeting in Hickory, Ky., TVA directors agreed to allocate $450 million of a contract with Stone & Webster Engineering Corp. to hire and oversee most of the 2,400 workers to be employed in restarting the Unit 1 reactor.

TVA expects to revive the reactor, idle since 1985, within five years by using outside contractors and engineers to do most of the work.

"Unlike in the past, this is not a forced schedule," TVA President O.J. "Ike" Zeringue said in a recent interview. "This is a schedule intended for efficiency, and I'm very comfortable we will meet out schedule and cost projections."

TVA plans to spend $1.8 billion to repair and restart the Unit 1 reactor at Browns Ferry by 2007. Mr. Zeringue said cost estimates by TVA indicate that the average cost of power from the unit, assuming it operates through 2033, will be only half what it would cost TVA to buy the power elsewhere or to build another type of power plant.

Restarting Browns Ferry, Mr. Zeringue said, should lower the average cost of power for TVA, although the agency has no plans to change its electric rates.

TVA is using optimistic assumptions about Browns Ferry.

But TVA nuclear officials said they have studied the idled unit carefully and are proceeding carefully to restart the unit. Because the Unit 1 reactor uses equipment and staff common to the other two reactors at Browns Ferry, the additional cost of running the reactor is relatively small.

Browns Ferry Unit 1 could add some 1,250 megawatts of capacity to the TVA power system, enough to light more than 650,000 homes.

TVA spokesman John Moulton said an architectural and engineering contract should be awarded for Browns Ferry by September.

Some 400 workers already are involved in the rehabilitation of the reactor. At its peak, about 2,400 workers will be involved in restart work at the plant near Athens, Ala.

The reactor, which began operation in 1973, has been idle since 1985 when TVA shut down its entire nuclear program because of safety concerns. Since then TVA has successfully restarted Browns Ferry's two other reactors for about $1.3 billion each.

Critics of nuclear power question whether TVA will realize the projected savings from the restart of Browns Ferry.

"TVA has a very poor record in meeting its cost projections in its nuclear operations and they are assuming that this unit will run 92 percent of the time, which I think is highly unlikely," said Stephen Smith, executive director of the Southern Alliance for Clean Energy.

Even OMB director Mitch Daniel has questioned whether TVA completes a new business plan and determines how it will pay for the plant. TVA has more than $25 billion in long-term debt and OMB officials want TVA to pare its borrowing before building more plants.