COTW: Too Expensive to Build

credit: Union of Concerned Scientists

The controlling theme for the US nuclear power industry is one of aging plants becoming obsolete and too expensive to replace [chart above]. The once touted "nuclear renaissance" is but a figment of the overwrought imagination of capitalists lusting for profit akin to their earlier claim that nuclear generated electricity would be "too cheap to meter". Case in point: Duke Energy's Crystal River plant. Crystal River 3 began operation in 1977. The 860MW reactor has been shut since 2009 because cracks in the walls of the reactor containment building were caused by replacement of its steam generators. Repairs caused other cracks or delaminations in 2011. Duke's own cost study said the repair bill might exceed $300 billion and take as long as eight years to complete. In comparison, a similar capacity natural gas combined cycle plant would cost about $1 billion and take only three years to build. Natural gas prices are at decade lows due to record production from fracking shale formations. The company delayed its project to build a new nuclear power plant in Levy County, Florida near the Crystal River facility until an in service date of 2024. It also revised cost estimates upwards for the 2200 MW facility to between $19 and $24 billion.

Dominion Resources which owns the 566MW Kewaunee reactor in Wisconsin announced it will retire the reactor over the next few months because continued operation of Kewaunee is uneconomic. The company bought the Green Bay area plant in 2005 for about $220 million and invested more while pursuing renewal of its operating license. According to rate filings, Dominion lost $20 million operating the plant in 2010, $39 million in 2011, and $303 million in 2012. Dominion has been trying to sell the plant, but has found no takers. The predicament has prompted local pro-nuclear legislators to propose subsidies for the reactor to stay in operation by changing the state's renewable energy mandate to include nuclear fission. The company said the proposed subsidies would not alter its decision to close Kewaunee, now scheduled between April and June of this year, since it is dictated by market economics. Decommissioning costs are expected to be about $281 million.

When gas prices soared in the mid 2000s, nuclear plants were more economic causing boosters to declare a "nuclear renaissance" was at hand {"nuclear power"}. Recently however, UBS Securities, the Swiss financial services company, has identified other aging US nuclear facilities that are uneconomic to operate. These include Vermont Yankee, Ginna and FitzPatrick in New York, and Clinton in Illinois. Expensive upgrades, stricter discharge regulations and low natural gas prices are all cited by UBS as reasons for possible decommissioning which is itself an expensive and lengthy process. It considers the 605MW Vermont Yankee facility as the "most tenuously positioned". A protracted legal dispute has evolved over the state of Vermont's authority to refuse necessary operating permits. At one point, the state Senate voted to shut the nuclear facility down. From too cheap to meter to too expensive to replace in fifty years--nuclear, US Person hardly missed you.