Nuclear power struggling to compete on a level playing field with natural gas and renewables
We’re now getting an idea of just how expensive building a nuclear plant can be. Ten years after owners of the only remaining nuclear plant being built in the United States first proposed the project, the owners say the total cost of building two additional units at the Vogtle nuclear plant in Georgia is likely to reach upward of $27 billion, more than twice the original estimate.
Earlier, South Carolina electricity companies opted to abandon construction of two new units at the VC Summer nuclear plant when the project’s estimated cost ballooned to $25 billion.
Both projects utilized Westinghouse’s AP 1000 reactor. Now bankrupt, Westinghouse is expected to get back on its feet sooner than had been thought. But with no further reactor orders from U.S. utilities – there haven’t been any new nuclear plants built in this country in 30 years – and the premature retirement of seven operating nuclear plants since 2014, Westinghouse won’t be anything like the company that once dominated nuclear power in the United States.
A recent report from the MIT Energy Initiative said, “The recent experience of nuclear construction projects in the United States and Europe has demonstrated repeated failures of construction management practices in terms of their ability to deliver products on time and within budget.”
Although there might be a market for advanced reactors like the small modular reactor (SMR) that would use standardized designs and be built in a factory to reduce capital costs and shorten construction times, U.S. nuclear companies are likely to face stiff competition from reactor manufacturers in Russia, China, and other countries that are engaged in a global race to commercialize SMRs.
Despite nuclear power’s problems, the Department of Energy has held out the possibility of saving several financially-ailing nuclear plants by providing financial assistance to keep the reactors in operation. But government loan guarantees weren’t of much help for the Georgia and South Carolina projects, and it’s unlikely financially-stressed operating nuclear plants such as Perry and Davis-Besse in Ohio and Beaver Valley in Pennsylvania – all of which are competing against an abundance of cheap natural gas and renewable power – would be able to do any better. Creating a “nuclear renaissance” in this country won’t happen if nuclear plants need to be subsidized. Besides, demand for electricity has plateaued nationwide as a result of major improvements in energy efficiency, weakening the need for baseload power from nuclear power and coal.
The trend away from nuclear power and coal is worth pondering in the aftermath of dozens of power plant closings around the country. The loss of nuclear power and coal provides an opportunity to find ways to reconcile our objectives – providing secure, reliable supplies of clean energy to keep our economy strong and growing, while preserving our environment. That will require a larger role for natural gas and renewables, the only sources of electricity that will let the United States regain its leadership role in energy production.
In a recent study, Shale Crescent USA examined the savings resulting to Ohioans due to the decline in natural gas prices over the last decade. The study noted that the figure below (courtesy of the U.S. Energy Information Administration) illustrates the rapidly increasing contribution of natural gas production from the Marcellus and Utica shales in Ohio, West Virginia and Pennsylvania that began in 2008. The region now produces approximately a third of all U.S. natural gas.
Providing a wide-open escape valve for struggling nuclear plants serves neither the interests of electricity ratepayers nor the interests of the American economy. Far better that we stabilize our power production at an affordable level while vigorously fostering energy research and development on advanced technologies in the areas of natural gas and renewables. An integral part of such progress is better access, particularly in states with shale resources, to natural gas supplies.
Dr. Robert W. Chase holds B.S., M.S., and Ph.D. degrees in Petroleum and Natural Gas Engineering from Penn State and is a registered professional engineer in Ohio. He was a professor and chair of the Department of Petroleum Engineering and Geology at Marietta College from 1978 until his retirement in 2015.