http://www.reuters.com/article/2011...SP20110325?feedType=RSS&feedName=domesticNews
U.S. nuclear plant costs may soar after Japan quake
By Scott Malone and Eileen O'Grady
BOSTON/HOUSTON | Fri Mar 25, 2011 1:03pm EDT
BOSTON/HOUSTON (Reuters) - The crisis at Japan's Fukushima plant could hit the U.S. nuclear-power industry in its weakest spot -- by raising costs.
Plant developers have spent years seeking approvals to build the nation's first new nuclear reactors in three decades, arguing that nuclear power offered the United States an opportunity to reduce its greenhouse-gas emissions and become less dependent on imported oil.
They have been less vocal about the cost of building a nuclear plant -- two to four times as much as for a coal or natural gas-burning power station. And with regulators seen mandating new safety measures in the wake of Japan's crisis, the gap will only widen.
The U.S. Nuclear Regulatory Commission has already launched a review of the nation's 104 nuclear plants.
It could consider an array of new safety measures at U.S. plants, from requiring passive cooling systems that could keep reactors and spent-fuel pools safe in the event of a power loss such as the Fukushima plant faces, to seeking stronger containment around spent-fuel pools, to mandating additional backup generators, experts interviewed by Reuters said.
"This is going to impose significant costs, perhaps material costs, before we are done," said John Rowe, chairman of Chicago-based power company Exelon Corp, the nation's largest operator of nuclear power plants.
The Fukushima plant was hit by a March 11 disaster beyond what the engineers who designed it some four decades ago had planned for. It was first rocked by a magnitude 9 earthquake that cut its connection to the power grid, then hammered by a tsunami that knocked out its backup electric systems.
Just as the September 11, 2001 terrorist attacks prompted security agencies around the world to redefine their concept of "worst-case scenario," the Fukushima accident could prompt regulators to demand more robust nuclear plants.
"I would hope that an accident of this significance ... would lay bare the reality of nuclear power," said Jim Riccio, nuclear policy analyst at environmental group Greenpeace. "If it doesn't lead to a much higher level of questioning of the nuclear industry, then there's something seriously wrong."
ECONOMICS 'NOT GOOD'
Tougher defenses could raise the cost of new plants and force operators of current facilities -- including the 23 using the General Electric Co Mark I design used at Fukushima -- to pay for pricey upgrades.
"The economics were not good at all for the U.S. to build new nuclear plants given the low (natural) gas prices and the outlook for huge reserves of gas," said Jone-Lin Wang, managing director for global power for IHS CERA, a Cambridge, Massachusetts-based consultancy that focuses on energy issues.
The cost of building a new nuclear plant in the United States could range from $5 billion to $12 billion depending on the facility's size.
The higher debt burdens that nuclear plant operators carry due to their higher construction costs effectively erase the economic benefit of using a cheaper fuel stock.
Prices of natural gas -- another major source of electricity in the United States -- have fallen about 69 percent from their last peak in July 2008, and the discovery of new supplies of shale gas leave some forecasters to conclude they will remain low for some time.
U.S. nuclear plant costs may soar after Japan quake
By Scott Malone and Eileen O'Grady
BOSTON/HOUSTON | Fri Mar 25, 2011 1:03pm EDT
BOSTON/HOUSTON (Reuters) - The crisis at Japan's Fukushima plant could hit the U.S. nuclear-power industry in its weakest spot -- by raising costs.
Plant developers have spent years seeking approvals to build the nation's first new nuclear reactors in three decades, arguing that nuclear power offered the United States an opportunity to reduce its greenhouse-gas emissions and become less dependent on imported oil.
They have been less vocal about the cost of building a nuclear plant -- two to four times as much as for a coal or natural gas-burning power station. And with regulators seen mandating new safety measures in the wake of Japan's crisis, the gap will only widen.
The U.S. Nuclear Regulatory Commission has already launched a review of the nation's 104 nuclear plants.
It could consider an array of new safety measures at U.S. plants, from requiring passive cooling systems that could keep reactors and spent-fuel pools safe in the event of a power loss such as the Fukushima plant faces, to seeking stronger containment around spent-fuel pools, to mandating additional backup generators, experts interviewed by Reuters said.
"This is going to impose significant costs, perhaps material costs, before we are done," said John Rowe, chairman of Chicago-based power company Exelon Corp, the nation's largest operator of nuclear power plants.
The Fukushima plant was hit by a March 11 disaster beyond what the engineers who designed it some four decades ago had planned for. It was first rocked by a magnitude 9 earthquake that cut its connection to the power grid, then hammered by a tsunami that knocked out its backup electric systems.
Just as the September 11, 2001 terrorist attacks prompted security agencies around the world to redefine their concept of "worst-case scenario," the Fukushima accident could prompt regulators to demand more robust nuclear plants.
"I would hope that an accident of this significance ... would lay bare the reality of nuclear power," said Jim Riccio, nuclear policy analyst at environmental group Greenpeace. "If it doesn't lead to a much higher level of questioning of the nuclear industry, then there's something seriously wrong."
ECONOMICS 'NOT GOOD'
Tougher defenses could raise the cost of new plants and force operators of current facilities -- including the 23 using the General Electric Co Mark I design used at Fukushima -- to pay for pricey upgrades.
"The economics were not good at all for the U.S. to build new nuclear plants given the low (natural) gas prices and the outlook for huge reserves of gas," said Jone-Lin Wang, managing director for global power for IHS CERA, a Cambridge, Massachusetts-based consultancy that focuses on energy issues.
The cost of building a new nuclear plant in the United States could range from $5 billion to $12 billion depending on the facility's size.
The higher debt burdens that nuclear plant operators carry due to their higher construction costs effectively erase the economic benefit of using a cheaper fuel stock.
Prices of natural gas -- another major source of electricity in the United States -- have fallen about 69 percent from their last peak in July 2008, and the discovery of new supplies of shale gas leave some forecasters to conclude they will remain low for some time.