TODAY’S STUDY: NEW NUCLEAR IS NOT THE ANSWER

Southeastern Utilities Plan to Expand Generation — Not Replace Coal with Nuclear Power; New Nuclear Power is Ruining Climate Protection Efforts and Harming Customers
Jim Warren, October 2011 (NC WARN)

Summary

A race between two powerful global forces is nearing a critical juncture. Climate change, which is increasingly devastating humans and other life across the planet, is within a very few years of passing irreversible tipping points. Meanwhile, a climate-protecting clean energy revolution is escalating in many parts of the world.

Five large corporate utilities in the southeastern United States could prove pivotal to avoiding runaway climate change toward what NASA climatologist James Hansen calls a planet for which human life is not adapted.

Since 2005, prodigious public relations campaigns have promoted those utilities’ commitment to lead the way to a “low carbon” future by building more nuclear power plants.

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But instead of replacing their coal-burning plants with nuclear power, the Southeast Five plan to keep operating most or all of their coal plants indefinitely, while adding more nuclear (and fossil fuel) plants so they can expand electricity sales both within and outside the region. This business model is based largely on the delusion that the U.S. economy will someday return to the unsustainable growth that created the combined economic-ecological predicament we now face.

The long-sought U.S. nuclear “renaissance” is now in shambles. Even the Southeast Five would have cancelled their problem-ridden projects except that, in recent years, state governments have forced customers to absorb the enormous financial risks. These captive customers must buy electricity from corporate monopolies that are protected from competition.

Outside the Southeast, states and utilities are avoiding what Moody’s analysts call “a bet the farm risk” posed by nuclear projects that private investors will not support. More than 20 states are adopting energy-saving programs along with cogeneration, solar and wind power, all of which are either less expensive than, or cost-competitive with, new nuclear generation. Those efforts are creating thousands of jobs, keeping power bills in check and cutting greenhouse emissions.

In the Southeast, however, utilities are not only evading — but actively blocking — the advances in those resources that are so abundant across the region; the same efficiency programs and renewable power that would speed the phase-out of carbon-belching coal boilers also dampen the need for expensive new nuclear plants.

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Giant centralized power companies could be driven to extinction by falling prices and growing markets for rooftop solar leasing companies — and recently, residential scale wind. Even the Southeast Five cannot entirely impede such distributed generation. But the climate clock is ticking faster and chaotic changes are accelerating.

Contrary to the utilities’ public relations claims, electricity demand in the Southeast has been flat or falling for years — despite population growth. Industry analysts predict that demand is likely to decrease further due to long-term economic restructuring and the adoption of energy conservation and efficiency in homes and businesses (which is gradually occurring despite the utilities). Ironically, nuclear construction would cause demand to fall further as customers respond to soaring rates.

Even if new nuclear generation were planned to replace coal, most of the proposed projects are taking nearly 20 years to complete (if any are finished at all), while climatologists warn that global reduction of carbon emissions must begin immediately to prevent global warming from becoming self-sustaining.

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Even if humanity quickly begins to reduce emissions, we still face decades of worsening climate conditions due to the past years of carbon pollution already in the atmosphere and oceans. That period of time will fully challenge our economic and social systems with chaotic weather and wildfires, and with increasing degradation of our water and food supplies, all of which amplify global conflicts and suffering.

The poor are being hurt first and the most, but no one will escape these challenges.

The Southeast still has a window of opportunity — closing rapidly — to join the shift to a clean energy economy that creates jobs and protects power bills. This would allow the region to join the growing international efforts to avert the worst effects of climate disruption, thus providing a positive “tipping point” toward stabilization of our climate and economies.

By contrast, a continued pursuit of new nuclear plants, while not closing coal power plants, could harm local and state economies and exacerbate the climate crisis instead of helping to mitigate it…

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Nuclear gamble could fail catastrophically

A continued pursuit of new U.S. nuclear plants instead of a genuine carbon reduction strategy could lead to amplified greenhouse gas emissions, as failing nuclear projects lead to increased reliance on carbon-based fuels (if clean energy projects continue to be stifled).

A coal and nuclear path could cause supply shortages during droughts and heat waves — since both rely on vast supplies of cooling water.

As a factor in slowing the U.S. revival, cost uncertainty on its own has so far been the major issue in competitive states. However, the southeastern nuclear utilities actually profit from construction cost overruns as long as they maintain control over legislatures and utility commissions who will pass the cost of mistakes along to captive customer bases through CWIP. Similarly, numerous engineering and construction contractors boost their profits on “change orders” that cause delays and ballooning costs.

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It is hard to imagine that Duke Energy can win state approval for its Lee Nuclear Station project if the N.C. Utilities Commission upholds the long held “least cost” standard.

In August the N.C. Commission limited Duke Energy’s request for funds for developing the Lee Nuclear Station to a maintenance level cap of $120 million for an undefined period. CEO Rogers had insisted he could proceed with the project only if he gained “tracking CWIP” (Super-CWIP) so the Commission slashed his request.

The U.S. nuclear revival has been slowed largely due to the multi-faceted questions about who pays if projects fail outright during construction; with billions in expenses accumulating from the outset and much of the cost being front-loaded, just the financing of a construction loan becomes a major risk factor. Hence, utility officials have insisted they must have federal taxpayer loans and/or state ratepayer prepayment in order to limit the risks of collapse.

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That fear is well-founded.

Now, uncertainties with designs, manufacturing, climate factors, world security, a fast-shifting energy market, and economic restructuring all pose additional risks of project collapse.67 Construction complexities are more than hypothetical. The highly lauded French nuclear industry is mired in two construction projects that are years behind schedule and billions over budget…

At Duke Energy’s coal-gasification construction project in Edwardsport, Indiana, the utility is haunted by a billion-dollar-plus cost overrun and dispute with lead contractor Bechtel that has been more than “a huge and embarrassing problem,” according to the Indianapolis Star. A persistent corruption scandal and federal investigation involving top state regulators and Duke officials, including CEO Rogers, are raising doubts about the plant’s completion…

Inevitable changes in designs and regulations due to the Fukushima tragedy will drive up complexities and costs, and very possibly terminate construction of the AP1000. The same now appears to apply to an emerging story about U.S. plants being inadequately protected from earthquakes. By the time design changes required due to those related problems are clear, the Southeast Five might have wasted even more years and tens of billions of public dollars in a direction that protects neither our climate nor our economies.

As noted above, many U.S. utilities — those in competitive markets — have already determined that they would rather sit back and observe others attempt to revive nuclear power.

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What About China?

In some developing countries, overall carbon emissions are likely to continue rising for a while as they build their economies; per capita greenhouse emissions remain many times lower than those in the U.S.

After more than 100 years of high carbon emissions, the United States must do its part to bring down global emissions regardless of what others accomplish. As for China’s oft-cited appetite for coal and nuclear power: China is a controlled economy not dependent upon a reasonable return on nuclear power investments. It is also leading the world in developing renewable energy.

Because it is also suffering increased impacts of climate change, we must hope that China will hasten the replacement of coal with renewables; indeed, there are signs that this is underway. Because the U.S. has been such a big carbon polluter for so many decades, every region of the nation must contribute to solutions.

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No time to waste on nuclear pretense

Chaotic weather extremes and a host of other climate-related tragedies are now providing a constant refutation against the corporate-funded confusionists still working to thwart action on what Dr. R.K. Pachauri, head of the Intergovernmental Panel on Climate Change, calls “an existential threat to civilization.” …

The United States must begin closing coal fired power plants and stop wasting precious time and resources on the pretense that new nuclear power will somehow avert climate and economic chaos.

For people following the science and world events, climate change is moving from emergency toward desperation — very close to becoming self-sustaining. As noted above, even if we quickly begin reducing annual greenhouse gas emissions, humanity likely faces several decades of worsening conditions due to past carbon pollution. Such a multi-faceted challenge could well surpass our societal and economic capacity to survive in a progressively chaotic world. And while climate disasters disproportionately impact the poor, an injustice imposed on those producing the least carbon emissions, no one will have guaranteed refuge…

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Although the U.S. news media continues to downplay the connection between chaotic weather and global warming, increasing numbers of scientists are speaking out.

Amplifying the challenge is the fact that unexpectedly extreme climate changes could become even more abrupt…

In August, the World Bank reported that global food stocks are “alarmingly low” as prices continue to rise and amplify conflicts; serial droughts are worsening the problem. Species migration to cooler latitudes and altitudes is happening much faster than was measured less than a decade ago, a problem “already affect[ing] the entire planet’s wildlife,” according to a prominent researcher.

Repeated climate disasters are already hammering the insurance industry and U.S. federal emergency coffers with multi-billion dollar bills. State and local economies are being hit by tornadoes, floods and wildfires, while droughts are moving farmland toward becoming deserts. The 2010 drought has cost Texas over $5 billion already, with no end in sight…

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Ironically the U.S. Southeast, a region being tormented by such haywire weather, is amplifying the accelerating crisis instead of mitigating it. The continued pursuit of new nuclear power plants in this region could ensure that the world moves past the “point of no return,” where climate change becomes self-sustaining — beyond any hope for human intervention.

The Southeast Five have already wasted six precious years attempting a nuclear revival that seems destined to fail and, moreover, is not even planned to help stabilize our climate by replacing coal. During that time the scientific case for climate action has become obvious.

It remains tragic that southeastern power companies have made no more than a feint toward helping people save energy — the fastest, cheapest way to close coal plants — while pursuing massive nuclear projects.

If the Southeast would stop hampering climate protection efforts — and instead use our abundant resources and human capital to help — we could well provide a positive “tipping point” in the global campaign to stabilize the climate. Jim Rogers and other utility executives could turn their enormous resources toward replacing coal with a clean energy economy. Doing so would boost the burgeoning public campaign to slow global warming, adapt for changes already in the pipeline, and help the millions of people already being devastated by climate changes.

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Technologically and economically the Southeast is ready to make such a shift. The main barriers are twentieth-century business models and the massive influence the Southeast Five wield over various levels of government.

There are reasons to hope for a course correction. The continuing nuclear design problems and risks of project collapse are just as real as the advances in distributed solar, wind and efficiency-conservation. Hopefully, some among the Southeast Five CEOs are business-savvy enough to realize that by turning away from new nuclear power they can avoid bankruptcy and become champions of a clean energy economy.

Within the context of an ominous long term economic outlook, we must hope that wiser corporate heads will avoid pitting themselves against a public that will revolt against continuing nuclear rate hikes and demand genuine action to help slow climate disruption.

Here in the Southeast we are living with the nuclear paradox: We could close all the coal plants if we stop trying to build nuclear power plants. We have a moral obligation to work honestly and cooperatively on this enormous challenge.