NRG to abandon two new South Texas nuclear plants, write down $481 million investment

On 25th anniversary of Chernobyl, U.S. nuke Renaissance still dead

  • Russian President Dmitry Medvedev marked the 25th anniversary of the Chernobyl disaster today with a visit to site of the power plant and announced he wanted new world rules covering safety.
  • Italian Prime Minister Silvio Berlusconi on Tuesday talked up nuclear power as the “safest” form of energy on the 25th anniversary of Chernobyl amid fears linked to the disaster in Japan…..  Italy abandoned nuclear power in 1987 after the Chernobyl disaster.  Berlusconi has promised to re-introduce nuclear power in order to cut power bills….

Ahh, if only new nukes could cut power bills (see Intro to nuclear power).  But then Berlusconi is the Charlie Sheen of Italian leaders.

The notable U.S. nuclear event leading up to the 25th anniversary of Chernobyl was the plug-pulling on one of the few remaining vestiges of the once-vaunted nuclear Renaissance.  As ABC News money reported last week:

Blaming uncertainties arising from the nuclear crisis in Japan, NRG Energy says it will write down its $481 million investment in two planned new nuclear reactors in South Texas.

NRG Chief Executive David Crane said Tuesday it was unlikely the two reactors could be completed in a timely fashion.

Support for new nuclear projects in the US has eroded in the aftermath of the nuclear crisis in Japan, according to an Associated Press-GfK poll conducted earlier this month. One of NRG’s partners was to be TEPCO, the Japanese utility that owns the reactor complex crippled by last month’s earthquake and tsunami.

But it isn’t lack of public support killing the nukes –it’s the economics (see The Nukes of Hazard:  Efficiency is 10 times cheaper today, renewables “costs are dropping fast”).    Back in October, Exelon CEO John Rowe explained that low gas prices and no carbon price push back nuclear renaissance a “decade, maybe two.”

In short, nuclear power has gone from “too cheap to meter” to “too costly to matter” (see The staggering cost of new nuclear power).

NRG, based in Princeton, N.J., hoped to build two new reactors at its South Texas Project nuclear station, an operating two-reactor power plant 90 miles southwest of Houston. The project is in line for a federal loan guarantee, but low electricity prices had clouded prospects for the plan even before the incident in Japan.

When prices of natural gas and electricity were high in the middle of the last decade, dozens of proposals for new nuclear reactors were submitted to the Nuclear Regulatory Commission. Now just a handful of projects remain active.

Southern Co. has begun work on a two-reactor project near Augusta, Ga. SCANA is preparing to build two reactors in South Carolina, about 20 miles northwest of Columbia. The Tennessee Valley Authority has resumed construction of a reactor in Eastern Tennessee that was abandoned in 1988 when it was nearly complete.

The meltdown in Japan pulled back the veil on the grim underlying economics of nuclear power and certainly killed the myth that we can afford to skimp on review, oversight, and safety in an effort to save money.

We should mark the Chernobyl disaster by remembering those who suffered through it — and recommitting to genuinely safe, low-carbon energy sources with declining costs (see Does nuclear power have a negative learning curve? ‘Forgetting by doing’? Real escalation in reactor investment costs).

14 Responses to NRG to abandon two new South Texas nuclear plants, write down $481 million investment

  1. Snapple says:

    In Belarus, the authorities jailed some Chernobyl activists so they would not be able to organize an unsanctioned demonstration to mark the 25th anniversary of Chernobyl.

  2. adelady says:

    And if they’d spent that $481 million on green power installations, they’d have been producing (how much?) power for (how many?) months already.

    And there’d be more to come – the investment would already be producing some income from progressive installation and connection, and could only produce more as the whole set-up connected to the grid.

  3. Scott says:

    This is good news for Texas Gulf Coast residents. The South Texas Nuclear Project isn’t really in what we call South Texas. It is near Bayport, about equidistant from Houston, Galveston, and Corpus Christi, a little over 100 miles from each and about 15 miles from the coast. At 29 feet above current sea level its operator says it would be “fully functional in any kind of flooding event” including a 100 year flood from the nearby Colorado (Texas) River coincident with the “maximum” hurricane storm surge, at least as “maximum” as they can imagine. We’re so fortunate here to have both drought and hurricanes in the same environment.

    Two reactors already at the site are only half the potential problem two more would present. Picking TEPCO as a partner…

  4. David B. Benson says:

    Meanwhile, the US nuclear manufacturing industry is doing just fine building parts for NPPs in China, India, Vietnam, South Korea (so also UAE), …

    South Africa is starting training of nuclear engineers in France as is Chile. India cannot graduate enough nuclear engineers as most are immediately hired away to other countries, a shortfall in India’s plan for 44 NPPs to be constructed.

  5. Paulm says:

    Nuclear power has a negative environmental and safety curve…. The longer we use it, guaranteed the more accidents there will be and the higher probability it will be used in anger.

  6. Solar Jim says:

    Forcing ahead with atomic fission under current circumstances, including all of it’s manipulation and corruption of public finance as well as it’s permanent toxic debt, unveils this poisonous vestige of military-weapons-industrialism for what it truly represents: nation-state sanctioned corporatism just as bad as fossil fools.

    Uranium fission and hydrocarbons are fuels of war. They are not “clean” and “sustainable energy.” They are poisonous explosives. Pabulum from sycophants and vested interests will never change this reality.

    The Atomic Age should end by abolishing all nuclear weapons and building no reactors. Go Sustainable.

  7. Roddy Campbell says:

    I think the key quote is from Exelon CEO, that low (natural) gas prices and no carbon sweeteners between them make nuclear uncompetitive in a free market-place. Which I think has pretty much always been the case for nuclear versus coal or gas on strict cash criteria.

    The average price of natgas front future over the last 5 years is over $6. At the moment it’s $4.42, very very cheap.

    That’s why Joe is right that it’s economics that prevents new nuclear build in reality, the economics versus other bulk baseload technologies.

  8. catman306 says:

    I wish that Southern Corporation/Georgia Power were smart enough to back out of the new reactors being built near Augusta. They will never make any money on this unnecessary construction. Isn’t making money why a corporation is in business? Or are there some kick-backs coming to the corporate and legislative deciders that we will never hear about? How else could they get a state legislature to enact special laws overruling the state Public Service Commission from preventing this construction? Something is clearly most unusual about this whole dirty deal.

    Or maybe Southern Corporation just rules here.

  9. Buzz Belleville says:

    I agree that cost is the primary impediment to new nuclear. I disagree that this is a good thing. Of course we need to pick the low-hanging fruit of efficiency first and foremost. And of course we need to incentivize renewables (and/or disincentivize fossil fuels). Of course we should change over coal plants to natural gas provided we can get a handle on fugitive emissions, water use, and wastewater storage in the hydrofracking process. But, at the end of the day, after all those strategies are maximized, we’re still going to need a baseload of energy that doesn’t contribute to global warming.

  10. Mike # 22 says:

    This early fallout from the spectacular fail-unsafe at Tepco’s BWRs is as it should be. These BWRs are intrinsically fragile. Any accident which wrecks cooling systems and releases radioactivity (plane crash, tornadoes, earthquake, big wave) leaves a rapidly heating reactor core with no way to approach (fire trucks and helicopters not withstanding). Some hours later, after the cores have boiled out, Zirconium reacts with steam to make high pressure hot hydrogen. Boom. If this had happened in a well populated area where winds did not disperse +90% of the plume into the ocean, we would be in the middle of a massive disruption. All the radioactive material which has been flushed into the ocean could be in a river somewhere, and that would be really bad. There are plenty of these reactors running today, all over the world.

    Some seem to be saying it is either/or with nuclear power. Either we embrace it or we walk away. There is more to it than that.

    The BWR style of reactor must be corrected or replaced on some reasonable schedule, say ten years. If a redesign cannot make it proof against coolant loss or any other conceivable failure, they need to be scrapped. Same with any other light water reactor designs. The onsite storage of spent fuel must be eliminated, even if it means just moving the casks and the pool a mile or two away. Spread the nuclear fuel out just enough to prevent the all-eggs-in-one-basket defect seen at Fukushima. I’d prefer to put the cost on the owners, but they will just game the system if past performance is any predictor of future behavior. So do cost share between rate payers and federal bailout. There is precedent–these are very toxic assets.

    Deal with the spent fuel. Expensive and technically challenging. Costs? Don’t know. There is enough uncertainty about economic and even nation state stability in the future, without leaving this stuff laying all over. It must be cleaned up.

    Accept that nuclear isn’t going away just because it is very dangerous and very costly. These monopoly types have a centuries long track record of getting what they want. Think coal and Newcastle. Hey, we’ve still got a TMI pin, the one that says “shut em down”. And there is still a reactor running on TMI.

    I am 100% certain that lithium electric cars and renewables could be scaled up faster than any other low carbon grid solution. The obstacles are political not technical; operatives have had some success at ridiculing battery powered cars and wind/solar–although this false message will yield in time. Meanwhile, new nuclear can contribute to shifting the grid away from coal. Not ideal, but then nothing about our situation is. But only if they prove the safety and they deal with the waste.

    So don’t hesitate to say how really scary Fukushima is. Or that the pressure vessel only just avoided failing at TMI, and a far worse accident barely avoided. Or that the boric acid had rotted out the head of the pressure vessel at Davis-Besse so that just a thin layer of stainless steel was left. These machines can be made much more safe, they must be made more safe, or shut em down.

  11. catman306 says:

    This refers to spent fuel pools, nuclear and fossil fuel ‘cooling towers’, and nuclear spent fuel casks. All of these require cooling which really is just wasting energy.

    There are several kinds of solar panels and techniques that can turn infrared radiation into electric power. They do it cleanly and some without mechanical equipment that would require maintenance.

    Why aren’t power companies required to use their waste heat to produce still more electric power? Could it be that the fossil fuel energy companies and nuclear fuel producers own the electrical power producing companies and their regulators and manage them in such a way as to use the maximum amount of fossil fuel to produce a given amount of electricity? Managing in such a way that wasted energy becomes increased profit.

    Clearly, this is a system badly in need of change and the technology to convert waste heat into electricity already exists. It’s not all that efficient at this point but as it becomes necessary will evolve as most technologies do.

    Look for savings and profits in the waste stream.
    Waste not, want not.

  12. Ron says:

    Ahh, if only new nukes could cut power bills.

    Wait a minute. I thought it was “too cheap to meter”?

  13. Merrelyn Emery says:

    Buzz #9, please see Mark Diesendorf’s article ‘The base-load myth’ (21.4.2011) on The Drum (ABC) under Opinion, ME

  14. Buzz Belleville says:

    Thanks Merrelyn (#13). Even Prof Diesendorf acknowledges the need for additional “peak power plants.” To the extent he’s suggesting that the world could get 100% of its energy from renewables (and I’m not sure he is), most experts disagree.