Saturday, June 27, 2009

Idaho congressional delegation on a nuclear roll

Simpson reports substantial increases in nuclear R&D funding and for cleanup

simpsonIdaho Congressman Mike Simpson, (right) a member of the House Appropriations Subcommittee on Energy and Water Development, on June 25 announced substantial increases in funding for the Idaho National Laboratory (INL) and the Idaho Cleanup Project (ICP) as part of legislation funding the Department of Energy in Fiscal Year 2010. The legislation was approved by the Subcommittee.

“Thanks to the hard work and dedication of those who work at INL, substantial new resources are headed Idaho’s way to improve facilities, expand reactor development, continue fuel cycle research, and push the development of the Center for Advanced Energy Studies,” said Simpson.

“The new funding in this bill can only be seen as a complete endorsement by Congress of the leadership role INL is playing in our nation’s nuclear renaissance.”

Among its provisions, the Energy and Water Development Appropriations bill includes:INL banner

  • A $54.03 million increase over the current fiscal year for Idaho National Laboratory facilities. Total Idaho Facilities Management funding is targeted at $194.03 million. The additional funding is available for a variety of uses including new buildings, renovation of existing buildings, equipment purchases, and the Advanced Test Reactor’s operation as a National Scientific User Facility.
  • A $76 million increase over the current fiscal year for the Next Generation Nuclear Plant (NGNP) bringing total funding to $245 million. The NGNP is designed to produce both electricity and heat for industrial applications. INL is the Department of Energy’s lead laboratory on research and development of the NGNP.
  • $10 million for INL’s Light Water Reactor Sustainability Program. The Program focuses on maintenance and life extension of our nation’s current fleet of nuclear reactors.
  • A combined total of $19.34 million is provided for INL’s collaboration with NASA on the supply of energy sources for deep space missions.
  • $1 million for equipment purchases at the Center for Advanced Energy Studies at INL.
  • $475 million for cleanup activities at INL, which is level funding with the current fiscal year but a $69 million increase over President Obama’s requested amount.

The Energy and Water Development bill is expected to be considered in full committee in two weeks and by the full House sometime in July.

Lane_Allgood In Idaho Falls, Lane Allgood, Director of the Partnership for Science and Technology, a pro-nuclear business group, praised Simpson’s work in an email to members and said that it showed the community was behind his advocacy for nuclear energy and cleanup programs at the INL.

Allgood reminded the group that the committee report still faces a vote in the full House and a conference committee with the Senate. The Obama administration is working to get the major appropriation bills passed in time for the start of the federal fiscal year which starts October 1st.

Risch votes against energy bill, joins western caucus

Risch, Jim-012109-18420- 0009For a U.S. Senator brand new to the game in Washington, Idaho’s James Risch (right) has surprised some here in Idaho by jumping on the pro-nuclear cause with determined vigor. He signed on with a dozen or so other republican senators urging congress to expand the federal loan guarantee program for new nuclear power plants. He voted against the Energy Bill being reported out of the Senate Energy & Natural Resources Committee because it didn’t support nuclear energy, and he hired a Ph.D. level nuclear engineer to be his legislative director.

That’s not all. He joined with other western senators, including Idaho’s Sen. Mike Crapo, in a caucus to promote energy development including new nuclear power plants and recycling of spent nuclear fuel. He also issued a statement of support for the Eagle Rock Enrichment Facility as did all other members of the Idaho delegation.

With all the ferment in Washington over energy policy, it takes more than just a partisan position to vote against the juggernaut of measures that are rolling through Congress. Risch, who is the ranking republican on the Senate Energy Subcommittee, voted against the Senate Energy and Natural Resources Committee's energy bill saying it fails to reduce U.S. dependence on foreign oil or to further the development of new emission-free nuclear energy. The bill passed by a vote of 15 to 8. Explaining his vote, Risch said . . .

"America's energy demands are growing and will only increase as the economy gets back on its feet. Nuclear and biomass are proven technologies that are ready now to address those needs and I am disappointed that we did so little to encourage the use of those technologies."

The bill now goes to the full Senate. A floor vote is expected later this year.

WaltMinnickWhat’s even more interesting is over on the House side, Idaho’s lone Democrat in Congress, Walt Minnick, (left) voted against the Obama Administration’s energy initiatives saying they were unfair to western states and failed to promote nuclear energy.

Idaho farmers are worried about increased fertilizer and power costs,” said Rep. Walt Minnick.

“Idaho energy companies believe it lacks proper consideration for hydro power and nuclear technology. Idaho businesses are frustrated with giveaways that rig the system in favor of pollution-heavy industry in the Midwest and California.”

Not another sagebrush rebellion but a coalition

Meanwhile, the Salt Lake City Tribune reports that Risch has joined Utah colleague Bob Bennett, Wyoming Sen. John Barrasso to promote tax incentives for building energy infrastructure, open federal lands for oil shale development and promote recycling of spent nuclear fuel to encourage new nuclear power plants.

While Hatch referred to the largely symbolic political effects of the sagebrush rebellion of the 1970s, the other Senators emphasized how they planned to work together to promote western energy interests.

Mike_Crapo_official_photoIdaho Senator Mike Crapo right) said the group is introducing the Clean, Affordable, Reliable Energy Act, known as the CARE Act, this week.

The CARE Act promotes development of new alternative and renewable energy, while expanding domestic oil and gas operations. It seeks to streamline the leasing and permit process for new energy development across many sources, from oil to nuclear power generation.

Nuclear-related provisions of the CARE Act include:

  • Language denying federal agencies the ability to stop nuclear power applications for reasons of waste disposal
  • The establishment of a new nuclear work group to coordinate new nuclear power efforts

Risch gets a ‘nuke’ as his legislative director

And if you are wondering where Idaho’s Sen. James Risch is getting his advice these days, look no further than Corey McDaniel who is his new legislative director. McDaniel most recently served as senior energy policy advisor to second-ranking Republican U.S. Senator Jon Kyl of Arizona.

"It is very beneficial to have someone of Corey's expertise step into the legislative director position. His vast experience with energy issues, along with his knowledge of the Idaho National Laboratory and Capitol Hill will be invaluable," Risch said in a statement on his Senate web site.

McDaniel will support the Senator's legislative priorities, particularly those related to his committee assignments as the Ranking Member of the Energy Subcommittee on the Energy and Natural Resources Committee and on the Foreign Relations Committee.

Before coming to the Senate in 2005, McDaniel managed a renewable energy development firm. He also served as a nuclear safety analyst at the Los Alamos National Laboratory in his home state of New Mexico.

purdue nuclearMcDaniel earned his doctorate in environmental science and public policy at George Mason University. He earned B.S. and M.S. degrees in nuclear engineering at Purdue University and the University of New Mexico, respectively.

At the American Nuclear Society annual meeting held Atlanta, GA, June 14-18, McDaniel was already hard at work talking with industry leaders and even nuclear bloggers about critical issues.

In fact McDaniel was moving so fast he hadn’t even had time to print new business cards. He gave out hand-marked up cards from his previous Senate staff post. If you have ideas or questions about energy legislation, he wants to hear from you. Contact Corey at Sen. Risch’s office in Washington, DC.

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Nuclear news roundup for 6/27/09

News comes in three forms – good, bad, and uglycatching up from spending a week of live blogging from ANS Atlanta

NRC cites utility shortfalls – says no free rides for decommissioning funds

free_rideThe Wall Street Journal reported June 20 that six nuclear utilities have until the end of calendar year 2009 to explain how they will make up the shortfall in their decommissioning funds. Another 12 firms are also getting notices from the NRC, but they are not as deeply in the financial ditch as the first six.

The NRC said it was concerned about the shortfalls in the funds. Nobody is going to get a free ride in terms of the agency’s regulatory requirements for maintaining the funds no matter how bad the market gets over time.

“We’ll discuss this with the plants over the next few weeks so they can explain to us how they’ll get the funds back on track to account for their decommissioning cost estimates,” said Tim McGinty, director of Policy and Rulemaking in the NRC’s Office of Nuclear Reactor Regulation.

“This is not a current safety issue, but the plants do have to prove to us they’re setting aside money appropriately.”

If you think your 401K is shot to pieces, wait until you see the numbers associated with the mess Wall Street made out of the investments utilities held to pay for closing their sites.

Like everyone else, the long term investment portfolio has shrunk thanks to unchecked greed by the so-called wizards of Wall Street. Under the Bush Administration, the Securities & Exchange Commission (SEC) took a long nap and now everyone is paying for it including nuclear utility decommissioning funds.

The most visible example is Entergy’s (NYSE:ETR) Vermont Yankee plant with a shortfall in the range of $600 million. The five firms other firms, all of whom are planning to build new nuclear plants, are Exelon, Constellation, FPL Group, and TVA.

In Vermont anti-nuclear legislators, who tried and failed in the last session to require Entergy to come up with the money right away, fulminated over the NRC’s notice. Governor Douglas has twice vetoed bills that would have mandated that Entergy come up wit the money and shut down by 2012.

Entergy, who owns and operated the utility, has applied to the NRC for a 20-year extension to its operating license. Anti-nuclear groups want the plant to close at the end of the current license which expires in 2012.

They’ve raised the issue of insufficient decommissioning funds as a reason why the plant should close. This is counter intuitive since such an action would deny the utility the opportunity to restore the decommissioning fund through contributions from earnings.

The WSJ reported that the Nuclear Energy Institute, which represents the nation’s largest nuclear utilities, noted that companies have up to 60 years to tear down plants once they are closed.

"We do have some time to recover that shortfall," said Adrian Heymer, senior director of strategic programs for the Nuclear Energy Institute (NEI).

Entergy says financing won’t hinder spinoff

entergylogoBloomberg wire service reports that while legislators in the super green state of Vermont are raising a stink over the shortfalls in Entergy’s Vermont Yankee decommissioning fund, the utility is bullish on plans to spin off six nuclear plants. They include Vermont Yankee and Indian Point. Other reactors are in Massachusetts and Michigan.

Entergy, which is the nation’s second largest nuclear utility behind Exelon, wants to bundle the six plants into a new company to be called Enexus Energy Corp. It would own and operate 5 GWe. The new firm would have to borrow $4.5 billion to finance the spinoff.

Given the cost of new nuclear power plants, at upwards of $4,000 Kw, the deal looks like a bargain. For its part, Entergy says the deal will deliver “full value of the plants” to investors.

Entergy CEO Wayne Leonard told Bloomberg the financial markets are improving. He reportedly said, “I don’t think you’d have any trouble raising $4.5 billion for these kinds of assets.”

However, not everyone is convinced it is a good deal for consumers. The New York Public Service Commission has worried out loud that the deal will produce a company with a junk bond credit rating, or as they say “below investment grade.”

Leonard told Bloomberg he and his board are getting impatient with regulatory delays. He also said that Entergy may wind up retaining some interest in the new company, but did not provide details.

Meanwhile, New York State Attorney General Andrew Cuomo continues to call for Indian Point, which has applied for a 20 year license extension from the NRC, to be closed when the current licenses for the two reactors expire in 2013 and 2015.

This is the same position taken by now former Governor Elliot Spitzer who resigned before he could benefit politically from this policy stance. Neither official ever told rate payers what the cost of replacement power for the 2.0 GWe of electricity provided by Indian Point would cost or that it would undoubtedly come from fossil fuel plants at spot prices.

Moody’s continues negative outlook for nuclear energy

Money futuresDow Jones reports that Moody’s Investor Service said June 25 that it may take a more negative view of utilities planning to build new nuclear power plants. The rating service discounted the value of federal loan guarantees as a moderating influence on the high capital costs of new plants.

Although federal loan guarantees will provide low-cost financing, Moody’s said they only "modestly" reduce the risk plant developers face.

"It has become increasingly likely that the pursuit of new nuclear power projects will lead to some near-term rating actions or outlook changes.”

Moody’s also discounted the favorable regulatory atmosphere in some states especially Florida, Georgia, and South Carolina. It said that the new plants can take upwards toward a decade to complete, from the time they apply for an NRC license, and can cost from $6-12 billion each. As a result Moody’s said, public utility commissions and rate payers may lose patience with the projects.

This is another counter intuitive judgment call by people who have an outlook on financial returns that can best be described, in family friendly terms, as “add water and microwave.” Translating that to the vernacular, it appears the rating service that has aligned its thinking investors who have no interest in understanding the nature of regulated rates of return in specific electricity markets.

To be fair, Moody’s also said utilities can preserve their ratings by spreading the risks of new plants through partnerships and cutting dividends to preserve cash to cover unanticipated construction costs.

Exelon to cut costs and 500 jobs

exelon logoNuclear engineering students who thought going to work for a large utility would be a guarantee against unemployment got a rude shock on June 18. The Wall Street Journal reported that Exelon (NYSE:EXC), the nation’s largest nuclear utility, is cutting costs by $350 million and eliminating 500 jobs to meet that target. The firm also froze some white collar salaries. About 100 managers will be among those who will be let go.

The firm employs 20,000 employees so the total numbers are a literal drop in the bucket or just 2.5% of the headcount. However, the layoffs will reportedly reduce 2Q 2009 earnings by $40 million or nearly $80,000 per warm body out the door. While Exelon, like other firms, isn’t going to disclose information on who was laid off, these kinds of costs suggest severance payments for senior employees.

The view that the firm is trimming its apparent top heavy management profile was reinforced by a statement from Exelon CEO John Rowe who told the WSJ . . .

"By rethinking our executive team structure and streamlining corporate support functions, we will increase both our efficiency and our focus on operational excellence."

In another sign of streamlining, the WSJ reported that President and Chief Operating Officer Christopher Crane, who manages Exelon's generation business, will also take over running the company's wholesale-power operations.

Maybe Exelon will be hiring new nuclear engineers after all since it still has to run 17 nuclear power plants and plans to build two new ABWR reactors in Victoria, TX. At the ANS national conference held in Atlanta June 14-18, a senior engineer with the firm told me that Exelon is serious about building the Victoria project. He should know because he and a lot of his colleagues are spending a lot of time on it.

Key investor says Exelon’s hostile bid for NRG is too low

hostile-takeoverWhile Exelon was tuning up its balance sheet to save $350 million, by laying off 500 people, and spending $40 million to do it, a key investor in NRG (NYSE:NRG), which is the subject of a hostile takeover attempt by Exelon, says the deal isn’t worth it at current stock prices.

Bloomberg wire service reports June 26 that MFS Investment Management (MMUFX), one of NRG’s largest shareholders, said NRG’s stock has gone up since Exelon made its hostile bid for the firm last Fall. Maura Shaughnessy, manager of the MFS utility fund, told Bloomberg . . .

“Exelon will have to pay much more or the deal won’t go through. I think Exelon is in a bind.”

MFS owns 4.6% of NRG’s stock. NRG’s market capitalization is $6.31 billion making the MFS position worth $281 million. NRG’s stock has been rising since its 52-week low May 1st of $14.39 a share and closed at $23.80/share on June 26.

When Exelon made its all stock offer last October, it said it would provide 0.485 shares of its stock for each of NRG’s outstanding shares or at $26.43/share.

Exelon’s stock price has since declined to $50.70/share which reduces its offer for NRG stock to $24.58/share as of market close on June 26. NRG’s stock closed at $23.80 on June 26 which hardly makes for much of a premium in terms of Exelon’s offer. The difference in Exelon’s offer made last October produced a premium of 37%.

Bloomberg reported that Exelon has no plans to sweeten its offer. Paul Elsberg, a spokesman for Exelon, said the company had nothing to add to the “value proposition” in its bid.

Shaughnessy thinks the situation will continue to improve for NRG. She told Bloomberg NRG is the “best run U.S. power producer” and that its prospects and stock price will improve as the economy rebounds and demand for electricity increases with that growth.

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Friday, June 26, 2009

Change NRC cost recovery rule for small reactors

A modest proposal to avoid killing off innovative reactor designs due to the expense of design certification reviews

In a widely read OP ED published in the Wall Street Journal on June 25, Bob Metcalfe, a well-known entrepreneur and venture capitalist, complained about the “high costs and astronomical risks” of the design certification process at the U.S. Nuclear Regulatory Commission (NRC).

seedmoneyHe points out there are at least five start-ups, some funded with venture capital, that are facing design certification costs of as much as $50-100 million each. Most of these costs, which the NRC must recover by law, will be driven by the fact that the new designs are not light water reactors. Hence,the NRC will have to spend considerable time moving up a steep learning curve at the applicant’s expense. For investors, that’s a lot of money and a lot of risk and all the while the product is not moving towards a market.

Metcalfe is right, and his complaint needs a solution

Mr. Metcalfe is absolutely right that the NRC's reactor design certification step is likely to be the place where the development of small reactors meets its fate. In an interview I conducted with NRC former chairman Dale Klein (left) June 16 in Atlanta, GA, at the annual meeting of the American Nuclear Society, he said that developers of small reactors will have to meet the same tests for safety as the big baseload plants.

NRC INTERVIEW“To be successful the firms promoting small reactors must do more than make sketches. There are the same serious issues with safety systems and reliability that the vendors of large system have to address. These issues apply with equal vigor under our regulations to small reactors.”

This is consistent with a speech he gave in 2008 when he said that small reactors had the NRC's attention and he called on the nuclear industry to work with the NRC to identify the key issues that would need to be addressed in the design certification process for them

The start-up firms that are developing new nuclear reactors in the range of 100-300 MW simply do not have $50-100 million to pay for NRC's review. Even billionaire Bill Gates, who's foundation is paying for development of a "Traveling Wave" reactor, may find he has limits when it comes to paying for government oversight.

The NRC has an important role in making sure nuclear reactors are safe. Congress needs to look at the cost reimbursement issue and make changes so that innovation in the nuclear industry isn't killed off by the way the NRC gets its funds.

A modest proposal in five easy pieces

There are lots of ideas floating around about what to do about Metcalfe's complaint. Here are five easy pieces for immediate action.

5easypiecesFirst, change the formula by which the NRC recovers costs from small reactors for design certification reviews. Instead of requiring the start-ups to pay for all of the costs, require them to pay for a complete application. In other words, hold them accountable for getting their design docketed by the NRC. This requirement will insure the NRC’s limited time, and stretched to the limit workforce, will not be wasted by stock speculators with kitchen table top sketches. Once the docketed application was in hand, the NRC would turn to a new line item appropriation to pay for most of the design certification costs.

2006_AESilverProof_O_180 Second, establish a line item appropriation to fund the NRC to conduct the design certification reviews of new reactors that are docketed and which meet certain technical criteria. Examples include power (less than 500 MW), the benefits of simplified design and below grade installation, in terms of reduced risk of coolant and core damage accidents, less fuel handling due to longer period of burn up of initial fuel load, and so on.

Third, the message to large reactor vendors, who will complain that this is a subsidy to their competition, is that they are well positioned to help sell and service these reactor designs once they are certified by the NRC.

While this proposal would significantly cut regulatory costs for start-up investors, they still face daunting challenges getting their products to market and that includes building or leasing manufacturing capacity. The large reactor vendors are in a position to form joint ventures with small reactor firms to supply manufacturing capacity and sales/distribution support in return for a combination of equity and profits.

salesFourth, the small reactors should consider forming a trade group to promote their interests which includes legislative proposals like this one. The cost of a lawyer and an engineer in Washington, DC, for a year probably could be had for less than $500,000. These firms should also form technical and regulatory working groups to provide input to the NRC on how it could streamline the current reactor design certification process for their innovative reactors without compromising safety.

Fifth, take the show on the road to the large reactor vendors. Convince them that there are potential profits to be had through joint ventures for manufacturing, sales, and services. Investors in small reactors want the fastest path possible to a return on investment. That means they don’t want to pay for or wait for small reactor vendors to build their own infrastructure or global marketing organizations. For instance, Mr. Metcalfe, the venture capitalist, if he did invest in one of these firms, would want to cash out from his position in five years.

What NRC and Congress can do now

There is also something for the NRC to do. It should start talks now with the small reactor firms and with its congressional appropriations committee to explore an alternative form of funding so that American innovation and export earnings don’t die on the vine because of the current cost recovery law.

Congress SealThe Congressional Budget Office (CBO) should be asked to calculate the cost of the change in NRC’s funding formula and also the benefits in terms of tax revenues from new businesses that would become profitable, along with their payrolls and high economic multiplier effects, once the reactor designs were certified for sale.

Energy Sec. Steven Chu could weigh in with a real commitment to the Next Generation Nuclear Plant (NGNP) making it a test bed for applications for small reactors, e.g., process heat, hydrogen production, as well as electricity. There is also work which is needed on fuel types, materials, and balance of plant, e.g., new types of turbines, that would benefit from government funded R&D. Small reactor vendors could work with the Idaho National Laboratory (INL) through Cooperative Research and Development Agreements (CRADAs) to move their R&D agendas ahead.

This isn’t a complete package, but there ought to be enough ideas for the small reactor start-ups to stop publishing OP EDs and start doing something to advance their interests. Their investors will likely thank them if they do.

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Thursday, June 25, 2009

Duke and Areva team up in Ohio

Proposed 1,600 MW reactor will build on Piketon’s nuclear legacy and help define its future – gaining public acceptance will be a key to success

DukeEnergyIt is a deal between giants. In the global world of multi-billion dollar agreements between mega-utilities and the continent spanning reach of reactor manufacturers, the announcement in Piketon, OH, this week got a lot of attention worldwide and in southern Ohio.

In addition to being a deal of a lifetime, it is also a potential tar pit of anti-nuclear sentiment created by years of distrust of government and industry actions and inaction over legacy hazardous and radioactive contamination. Anti-nuclear groups immediately focused on the still unfunded project and may seek to leverage negative community sentiment on cleanup issues to impact acceptance of the new reactor project.

If anyone doubted the importance of the contract for the parties involved, Duke Energy and Areva, they needed only to look at the video of the press announcement to see Jim Rogers, CEO of Duke Energy, and Anne Lauvergeon, CEO of Areva, talking into the lens of the television cameras.

Launched on the site of a former uranium enrichment plant in Piketon, OH, about 85 miles east of Cincinnati, the plant will be built by a group calling itself the Southern Ohio Energy Park Alliance. It consists of the site owner, U.S. Enrichment Corp. (USEC)(NYSE:USU), the utility Duke Energy (NYSE:DUK), Areva, the French state-owned nuclear reactor vendor, and Unistar Energy which is a reactor building consortium of Areva, Constellation Energy, and Bechtel.

The way the agreements are expected to work among the various parties are that Duke Energy would be the owner and operator of one or more 1,600 MW U.S. EPR design nuclear reactors supplied by Areva. Unistar would develop the COL license application for the project to the NRC. It could be filed as early as 2010. Bechtel, a Unistar partner, will build the plant and related infrastructure. USEC would lease the site for the life of the reactors and provide all site infrastructure.

Why here why now?

There has been plenty of straight news about the deal, but some questions remain open. For instance, what brought this combination of companies together and why? To answer it start with a look at the site. It’s legacy goes back to the Manhattan Project in World War II when it was used to produce enriched uranium in a gaseous diffusion process.

powerlinesThat process involves massive amounts of electricity which was supplied by TVA. The transmission and distribution infrastructure that brought electricity to the site is still in place. The wires that brought power in can now be used to send power out to an energy hungry Midwest that knows the days of coal-power are drawing to an end.

Duke Energy is right in the middle of that change. While it is one of the nation’s largest nuclear energy utilities, it is also one of the nation’s largest coal fired utilities. In his press statement, Duke CEO Jim Rogers said, “We face the indisputable fact that our nation and our world are transitioning to a low-carbon future.”

He told the New York Times in a telephone interview, “Most of our fleet in Ohio, which is coal-fired, will be retired over the next 15-20 years. We’re going to need to replace it, and this plant will replace that capacity.”

1st in line for a fleet change out

This is the first time Duke and Areva have teamed up on a reactor project. If the project is successful, Areva will be first in line for future orders to replace other Duke coal fired plants. Overall, it is a vision that spans decades and even generations, but it fits the worldview of some who have said that thinking seriously about nuclear energy requires a perspective that spans 100s of years.

The Piketon site is also home to USEC’s new American Centrifuge facility which if completed will produce over 3.5 million SWU of enrichment services a year for the nation’s commercial nuclear power plants. USEC has been on a continuing hunt for investors. Last Fall it let a $1 billion contract with Fluor Corp. to ramp up construction, but by late winter 2009 it had stopped work and laid off almost all of the workers due to cash flow problems.

If USEC can convince investors the reactor project is real, it will be a confidence building measure. After all, a huge, 1,600 MW reactor next door to the enrichment plant is an obvious customer for its services. That may not be enough.

Gas-centrifugeAreva and USEC are currently locked in a competitive battle over $2 billion in federal loan guarantees for uranium enrichment plants. For its part, USEC has said it cannot attract investors without the loan guarantee. Areva is the reactor vendor in Ohio selling reactors so its participation in the project will not affect its capital requirements for other U.S. activities like the enrichment plant in Idaho. That gives it a competitive advantage and a reason to be in Ohio.

Areva’s Eagle Rock Enrichment Facility, to be built in Idaho, will have an initial capacity of 2.4 million SWU, but the company has filed an amendment to its license application with the NRC to double the size of the plant if market demand supports it following start-up in 2014. If USEC's investment strategy fails to materialize, Areva and Louisiana Energy Service, which has also planned to double the size of its plant, will be positioned to pick up the market share left on the table. For its part, USEC is determinined to succeed and has said it will aggressively pursue its business goals.

Public acceptance issues put a bulls eye on the project

Finally, there is the issue of public acceptance of more nuclear facilities at Piketon. The area is controversial with the public. In 2007 citizens groups in the area came out like swarms of angry hornets for hearings held last year when a GNEP facility was proposed for Piketon which is also a nuclear waste cleanup site managed by the Department of Energy.

peasants revoltingMore than 300 people testified against the GNEP project. Citizens groups have objected to any new nuclear facilities at the site until the current one is cleaned up. The political landscape looks like an alien battlefield with hovering fleets of flying saucers zapping a rouge planet. Or put another way, the peasants revolted coming out, metaphorically speaking, with pitchforks and pruning hooks to drive off what they perceive as an evil influence.

For nuclear energy to be acceptable at Piketon, Duke and its partners will have to put a communications strategy on the ground that differentiates its project from the legacy clean up issues that have enraged the community. Even more to the point, anti-nuclear groups will see the Piketon project as a ripe opportunity to exploit existing high levels of alienation.

On a national scale, anti-nuclear activists like Harry Wasserman are already mounting a rhetorical attack on the project. If the anti-nuclear groups in Ohio, and nationally, can make enough trouble, forcing Duke and Areva to walk away, then they can count coup in a kill and cast doubt on the viability of the nuclear renaissance.

Aiming for a bullseyeMake no mistake about it, this project is in the sights of anti- nuclear groups which are looking to make an example out of it. It is also an opportunity of a lifetime for Duke and Areva to do something different in terms of on-the-ground and national communications strategy than just roll out a web site and hand out fliers at chamber of commerce breakfasts.

The advantages of the site for the partners in the Southern Ohio Energy Park have produced compelling reasons to want success at that site. The question is whether with all that corporate throw weight whether anyone has thought through the necessary transparency and confidence building measures needed to convince the people of Piketon, OH, that they will benefit from the plant. Real jobs associated with the project, numbered in the 1000s, will not materialize for at least five years. What will Duke and Areva do in the meantime?

Watch the space in Piketon. Everyone else is.

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NEI – Cooper study “biased”

Analyses show nuclear is 'least cost option' for generation of new baseload electricity

CigarSmokeNucNet - analyses in several US states show that new reactor units will be the “least cost option” for new generation, the Nuclear Energy Institute (NEI) said this week in response to a study The Economics of Nuclear Power: Renaissance or Relapse? by Mark Cooper, who is identified as a senior fellow for economic analysis with the Institute for Energy and Environment at the Vermont Law School.

NEI - Vermont Law study is biased

The nuclear industry trade group couched its response in measured phrases, but the real message is, more or less, Cooper is blowing smoke.

Among claims arising from the study, published earlier this month, was that actual cost estimates for proposed reactors is some four times higher than industry projections from less than 10 years ago.

However, the NEI said the study presented a “biased view” of the overall picture in the US. In a detailed response, the NEI said:

“Based on studies by the energy companies contemplating building new reactors and independent analyses, new nuclear power plants are expected to produce electricity at competitive prices. New nuclear plants in some markets may be one of the most cost-effective ways of generating electricity in a carbon-constrained world.

“Contrary to the study’s finding that ‘nuclear power cannot stand on its own two feet in the marketplace’, nuclear energy is expected to be among the most economic sources of electricity … New nuclear reactors have been affirmed as the least cost option for new generation by the Public Service Commission (PSC) in South Carolina, Florida, and Georgia.

“The analyses supporting the PSC reviews found nuclear to be cost competitive with other forms of baseload generation in addition to helping to address climate change.”

NEI White Paper on nuclear plant costs

nei logoA paper by the NEI, which provides a survey of cost information for new nuclear and coal-based generating capacity and summarizes recent analyses of the comparative economics of new electric generating capacity is on the NEI’s website

The study by Cooper is on the web site of the Institute for Energy and the Environment at Vermont Law School. In fact Mr. Cooper’s relationship with the law school may be tenuous according to Charles Barton at NuclearGreen.

Here’s his real bio - Mark Cooper is director of research at the Consumer Federation of America (CFA) where he has responsibility for energy, telecommunications, and economic policy analysis. The rest of his bio reveals a sterling educational pedigree, but as previously noted on this blog, even smart guys can be wrong.

Where there’s smoke there’s fire

BTW, in another case where smart guys are wrong, at least about nuclear physics, Ralph Nadar, who helped organized CFA, has been outspoken in his opposition to smoke detectors which use tiny amounts of Americium 241. Encased in plastic, the alpha emitter poses no risk to anyone unless you break the thing open with a hammer and try to eat it. The World Nuclear Association has the real 411 on the safe use of this isotope.

SmokeDetectorDesignMr. Cooper’s study has been called “biased” by NEI, but in the case of Ralph Nader and smoke detectors, the American Nuclear Society (ANS) makes it clear why they recommend use of the Americium 241 model. Here are the facts.

The ionization smoke detector uses a tiny bit of radioactive americium-241, a source of alpha radiation. An air-filled space between two electrodes creates a chamber that permits a small, constant current to flow between the electrodes. If smoke or heat enters the chamber, the electric current between the electrodes is interrupted and the alarm is triggered.

This smoke alarm is less expensive than other designs and improves the original smoke alarm by measuring more than the heat of a fire. It can detect particles of smoke too small to be visible.

Finally, hats off to the Idaho Section of the American Nuclear Society which each year gives away hundreds of smoke detectors to families in Idaho which otherwise could not afford them.

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