Monday, July 28, 2008

Ameren files for 2nd reactor with NRC

It specifies a 1,600 MW Areva EPR to be online by 2018-2020

bulbThe St. Louis Business Journal reports that Ameren (NYSE:AEE) has submitted a construction and operating license (COL) application with the NRC for a new nuclear power plant in Callaway County, Mo.

The Journal reports the 8,000-page application seeks approvals from the NRC to build an Areva EPR, a 1,600 MW unit, next to AmerenUE's existing nuclear unit, Callaway Plant, located 10 miles from Fulton, Mo.

At $3,500/Kw the plant could cost $5.6 billion, though by the time the utility breaks grounds these costs could be higher. Review of the application will take three-to-four years. Also, the Areva reactor design is not yet certified by the NRC. Assuming that process moves ahead briskly, a new plant could enter revenue service within five-to-six years of NRC approval of Ameren's COL.

Thomas Voss, CEO, said there are compelling reasons to file the application.

"Given projections for a nearly 30 percent increase in demand for power in Missouri in the next two decades, we believe we will need to build a large generating plant to be on line in the 2018-2020 timeframe. Applying for a license now better positions AmerenUE to build."

Keeping its options open

Reuters reports the company said it has made no decision to build a new reactor at this time, but was seeking NRC approval to preserve the nuclear option for the future. Voss said the company's decision on whether to build depends on a number of factors, including

  • forecasted demand for power;
  • effectiveness of energy-efficiency initiatives;
  • projected costs and financing challenges of building an advanced nuclear power plant;
  • state and federal regulatory and legislative actions.

AmerenUE said it's pursuing a nuclear energy plant because "the generation of nuclear energy produces no greenhouse gases or air emissions."

The company will spend $30-50 million on the application. It's certainly plausible the utility would walk away if the numbers don't add up when it comes time to build. The firm wouldn't start down this road if there wasn't an equally plausible reason for them to go ahead. Ameren's caution is required by Missouri law which stipulates the utility adhere to the principles of the "prudent investor," a uniform law implemented in many states. Likely, Ameren would make an announcement to build just prior to the construction state of the reactor project.

& & &

Prior coverage on this blog: Ameren to move on second reactor

# # #

No comments: