Nuclear industry stirs with plans for new plants

Nuclear plants still use low-grade nuclear reactions to generate heat and create steam or pressurized water to spin turbines. But instead of the one-of-a-kind designs the new plants will use interchangeable modular designs. Gravity, instead of pumps, will move water in an emergency and new alloys and digital controls will also improve operations and safety. The 1979 accident at Pennsylvania’s Three Mile Island plant began when cooling system pumps and valves failed.

The NRC has already approved two Westinghouse designs. One GE-Hitachi design has been approved, another is pending. Areva plans to submit a design for approval soon.

Nuclear plants cost more than conventional plants, but are cheaper to operate. A new 1,000-megawatt reactor would cost $2.1 billion in 2006 dollars, compared to $1.3 billion and $600 million, respectively, for comparable coal and natural-gas plants, according to EIA estimates.

But the average cost of nuclear-produced electricity was 1.72 cents per kilowatt hour in 2005, versus 2.21 cents for coal-fired plants and 7.51 cents for natural gas plants, says the Nuclear Energy Institute, a trade group.

Weighing in nuclear power’s favor is utilities’ belief that the government will constrain or tax greenhouse gases, which would significantly increase operating costs at conventional plants. Nuclear plants emit greenhouse gasses, but far less than conventional plants.

Also pushing utilities toward nuclear power are new regulations that let companies apply for a single construction and operating license. In the past, the licenses were separate.

“You might spend a few billion dollars, and then you’re at risk of not getting an operating license,” said NRC Chairman Dale Klein.

Long Island’s Shoreham Nuclear Power Station, for instance, was completed in 1984 for $6 billion but never opened due to community opposition.

Licensing isn’t cheap, either. Hutchinson estimated the process can cost $50 million to $100 million.

“Bottom line, in developing a nuclear project, you could be spending several hundred million dollars just to keep the option open,” Hutchinson said.

Critics say the industry is overstating the new plants’ advantages, and ignoring the unresolved issue of spent nuclear fuel.

“There clearly are some benefits to relying on gravity over electric motors and pumps,” said Paul Gunter, director of the reactor watchdog project at the Nuclear Information and Resource Service, which opposes nuclear power plants. “But there are no guarantees that terrorism or an accident won’t penetrate one of these new designs.”

Indeed, radioactive water leaked into the Sea of Japan from buildings housing reactors built to one of GE’s newer designs after July’s magnitude 6.8 earthquake struck Japan’s Kashiwazaki-Kariwa Nuclear Power Plant.

Community opposition could stop projects. Steel parts could cause another potential bottleneck: Most necessary large forgings can only be made at Japan Steel Works, which can supply only 7 to 8 plants a year, Hutchinson said.

Still, GAMCO’s Abramson says investors are comfortable the industry and NRC have addressed the problems that caused cost overruns last time.

“I think investors know that you can’t find anything with zero risk,” he said.

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