The flagship project of the US nuclear energy renaissance is in trouble. The people of the great state of Georgia and the investors in Georgia Power may end up footing the bill for actions that have been taken to delay the project. I feel a personal and a professional attachment to the story; I want to share my anger and frustration with others.
On a personal level, my dad was born in Georgia, he dreamed of retiring on a little piece of property that we called Taccoa-60 because it was situated along the Taccoa River right off of Highway 60 near Dahlonega.
We vacationed in the area every other year; we loved tubing and fishing in that river near dad’s “retirement property.” I have fond memories of evenings spent going over Dad’s plans for the small cabin with a big wrap around deck to take advantage of being on “Georgia’s prettiest whitewater stream.” Unfortunately, Dad’s dream never happened. The last time I checked, my widowed mother continues to hold some Southern Company stock that Dad originally purchased as Georgia Power company stock.
On a professional level, there is a lot riding on the success of the project to add two new Westinghouse AP1000 reactors to the Vogtle site in eastern Georgia along the Savannah River. It is one of only two remaining projects that is actually moving forward out of the finalists for the first round of loan guarantees initially authorized by the Energy Policy Act of 2005. It is the only project to have actually been awarded a conditional loan guarantee and the one that is most at risk of having a significant schedule interruption if the Nuclear Regulatory Commission dallies even longer in its review process for the completed design certification license application.
This morning, the Wall Street Journal published Rebecca Smith’s article titled Georgia Eyes Cost Buffer for Nuclear Plant that described how the public utility commission is considering changing the cost recovery rules because they are being pressured by people who think that the project is in danger of a cost and schedule overrun. The company leaders testified that they would have chosen a natural gas project as being “more cost effective” (for the company) if they had known that there was a possibility of the rules of the game being changed six years after the project decision was made.
I have been involved in the financial analysis of enough large projects to know that there are two sure ways to add cost to any project. The first method is to add delay – it always costs more in the end to delay action because the people assigned to the project collect the same daily salaries and wages without making as much daily progress. The second method is to add lawyers to the mix; they are professionally motivated to argue and delay. After all, they bill by the minute.
As Atomic Insights readers know, I am certain that there are plenty of powerful people with strong financial motives for inserting as much cost and schedule delay as possible into any and all nuclear projects. As the Southern company executives testified, the alternative to a nuclear plant is a gas plant. That means that natural gas sales increase substantially if nuclear fails to deliver, even if the reason for the delay is purposeful action to slow progress. Anyone who tries to tell you that they are going to replace a nuclear project with solar or wind is either delusional or lying.
Those of us who agree that nuclear fission is cleaner, safer and more cost effective – especially over the long term – than burning natural gas should stand up and defend the technology against the professional detractors. Even though I work for a company that competes with Westinghouse, I want their project to be a huge success.
Here is the response that I posted in the comment section of Ms. Smith’s Wall Street Journal article.
The sad part of the story was the apparent lack of understanding by the project detractors of the impact of their actions on the cost of the project. The length of time spent building the plant will have a very real impact on the cost of the project due to the fact that more time means more salaries, more interest on borrowed money, and a greater chance of increased prices for materials and equipment purchased and installed at a later time than planned.
Maintaining projected costs and schedules is highly dependent on the actions of regulators and intervenors who continue to slow down progress with legalistic arguments that have nothing to do with safety. The issues that the regulators raised are related to a difference of technical opinion on whether or not is reasonable to neglect the impact of solar heating and cooling while modeling the behavior of the containment building after an accident that releases 600 F water and steam into the building.
Westinghouse went back and recalculated the impact of the minor term in the equation – the final result was that under absolutely worst case conditions, the final pressure inside the containment went up by about 0.3 psi and was still well below the building’s allowed maximum pressure.
The current Chairman of the NRC is a professional political staffer whose complete professional experience following college was working for two avowed antinuclear politicians. He has cost taxpayers in 31 states billions already with his decision to refuse to finish the Yucca Mountain license review; now he is aiming to cost Georgia ratepayers and GA Power investors (remember, utility investors are often widows and orphans) hundreds of millions to billions more. He took the unprecedented step of issuing a press release calling Westinghouse’s application into question over such a technical dispute regarding the significance of terms in a mathematical model.
Americans need to know just how job unfriendly the NRC Chairman is.
Full disclosure – I work for a company that is designing nuclear reactors that will soon need to be licensed by the Nuclear Regulatory Commission. I fear for my long term employment and that of hundreds of my colleagues and neighbors.
Rod Adams, Lynchburg, VA
In other nuclear news:
- The Vermont Attorney General refused to indict anyone for perjury in the controversy over tritium leaks at Vermont Yankee. Not surprisingly, Governor Schumlin maintained his insistence that Entergy employees lied, despite the lack of evidence for that assertion.
As the math and statistics wizards at NEI pointed out, the statement depends on what you call a “renewable” energy source. If you like municipal solid waste, wood burning at paper mills, mandated ethanol fuel, and large hydro power plants built during the Depression through the period immediately following WWII, then you might agree that “renewables” are a substantial contributor to our energy security. If, on the other hand, your definition of renewables includes the more popular wind, solar and geothermal, a closer look at the statistics reveals that those three accounted for about 1/6th (17%) of the energy produced by the 104 units in the commercial nuclear power fleet.