06/20/09 - ChicagoBoyz by Carl from Chicago
[edited] Nuclear energy provides a significant portion of the world’s base load power capacity, along with coal power, gas, and hydro-electricity. [Base Load is the power that is available all the time without interruption. -ag] While “renewable” energy and conservation receive the lion’s share of the media coverage, they make up a minuscule proportion of our total generation.
The United States has invested little in new base-load energy capacity, other than natural gas. Our existing plants are aging. New plants have a long lead-time. If no new plants are started soon, we will have retirements and no reasonably priced options to replace them. This will drive up the total cost of energy [electric rates] and make our economy less competitive.
I see two common views.
- The "Greens" view nuclear plants as a possible solution for greenhouse emissions and a substitute for "dirty" coal.
- The "Engineers" talk about new, efficient plant designs and how technology can help us resolve this situation. The technology in current nuclear and coal plants comes from the 60’s and early 70’s.
I will call my viewpoint “bitter realist”. I have decades of experience with the utility industry, primarily on the financing side, which also requires a fair dose of regulatory experience.
Carl talks about some recent government decisions that are not helpful.
- Obama decided not to fund the Yucca Mountain storage facility in the 2010 budget. This was intended to store spent nuclear fuel after use in electricity generation. It is almost finished after $9 billion spent ($9,000 million).
- The US Government recently selected four companies for Federal loan guarantees for new nuclear plant construction. Why just four, and why these four? Hard to tell. Further, the loan guarantees are small compared to the regulatory demands and future risks.
There is continuing legislative heavy handedness (NRC decommissioning) and ineptitude (Yucca Mountain) which would make any rational investor think twice before investing.
I am a fan of nuclear power and believe that it is a great way to make our country more competitive. Done correctly, it is far cheaper to run in the long term, and reliable under all conditions.
As a “bitter realist”, however, it isn’t going to happen.
A blog recommended by Carl: Life in the Great Midwest
50+ posts on the energy industry in the US