As the world intensifies its efforts to reduce climate-changing carbon emissions, many are wondering if nuclear power should get a second look? Nuclear energy is essentially a carbon-free energy source, but it comes with other baggage—including a big public relations problem. But it turns out, nuclear energy’s future may be tied less to public sentiment than the price of natural gas. Earlier this week, the Allegheny Front’s Kara Holsopple talked with Chris Gadomski—a nuclear energy analyst with Bloomberg New Energy Finance—about why that is.
Kara Holsopple: What have been some of the biggest challenges to the nuclear energy industry over the last few decades?
Chris Gadomski: The biggest challenge is trying to rein in the escalating costs of building nuclear power plants, which have climbed tremendously as a result of regulations following the Three Mile Island incident in 1979. And more recently, when you look at the cost of nuclear energy compared to other power generation technologies, it has been climbing very, very fast—to the point now where it represents a very expensive proposition and a rather daunting proposal for many utilities. Secondly, the sequence of events regarding Three Mile Island, Chernobyl and Fukushima has really installed a lot of fear in the general population about some of the potential dangers of nuclear power.
KH: So what kind of safety advancements has the industry made?
CD: Some people argue that Fukushima perhaps had a silver lining—that the nuclear industry looked very hard at its operating procedures, learned from what happened, and has taken steps to make sure that if something else occurs, they’ll be much better able to handle that kind of situation.
I visit nuclear power plants on a regular basis. And I just visited the Millstone plant in Connecticut, and they had a hardened bunker there with trucks, tractors and anything that a first responder would need in case of another type of event. So if something goes wrong, they have a lot of equipment, which the Japanese didn’t have access to, on site in a separate building that was hardened. Westinghouse has also come up with an earthquake-robust design, targeted at countries like Turkey, which is considering building nuclear power plants. There was a 7.8 earthquake in Turkey within a year of the Fukushima disaster.
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KH: How many new nuclear power plants are coming on in the U.S. and how many are leaving?
CD: In the U.S., we have five reactors that are under construction today. One, in Tennessee, is loading fuel this quarter, so we expect commercial operation in the next few months. We’ve closed five reactors in the last several years—two in California as a result of bad steam generators that sprung a radioactive leak. They would have ordinarily been repaired and restored except that the utility made a decision to close the reactor—in part because the uncertainty of starting them back up and the availability of comparatively inexpensive natural gas. Since EPA’s Clean Power Plan has been enacted, we’ve announced the closure of two more reactors. Those reactors will probably close sometime between 2017 and 2019—again as a result of the availability of inexpensive natural gas.
KH: Do you think nuclear power could play a bigger role in reducing the U.S.’s reliance on fossil fuels and meeting those carbon reduction targets that the Clean Power Plan requires?
CD: I just looked at a report that looked at the consequences of closing down the Vermont Yankee nuclear power plant. The electricity that was generated to replace the electricity from the nuclear power plant was largely natural gas. Natural gas is a great fuel. It’s very inexpensive, but it has 50 percent of the emissions of coal. So we’re going from a technology that is essentially carbon-free to a technology that still releases a lot of greenhouse gases into the atmosphere. So that’s counter to the objectives of the Clean Power Plan. People don’t realize what a large contribution nuclear energy makes at present to the amount of clean power that’s generated. Nineteen percent of electricity in the country is generated by nuclear power, but more than 60 percent of all the carbon-free generation is from nuclear power.
KH: So in the U.S., with all of this cheap natural gas, is there a chance for nuclear power to have a bigger play in our energy mix?
CD: I have always said that we have never guessed correctly at natural gas prices. Several years ago, we were planning on building import terminals to import more natural gas. And the discovery of copious amounts of shale gas in various parts of the country has led to an unbelievable revolution where we have a tremendous amount of natural gas available at very good prices. Unless we have a change in that dynamic, it’s very, very difficult to convince utility owners to build more nuclear power plants. Having said that, there is a tremendous value that utilities place in portfolio diversity. If you have all natural gas generating your electricity, that represents a pretty risky proposition. So there may be an opportunity to squeeze in.
KH: Germany is doing away with nuclear power, but China is embracing the industry. Is it approached differently in different countries?
CD: In a place like China, the amount of energy demand is increasing very rapidly. I was in Shanghai just a couple of weeks ago, and as I came from my airport to the hotel, my eyes started tearing, I started coughing, and I could really feel the presence of pollution in the city. China is going to build more and more nuclear power plants, and one of the reasons is that they need to deliver clean electricity to abate their pollution problems.
In Germany, they have made a decision to invest heavily in renewable technology, which is an admirable thing for them to do. Their policies have led to a significant decline in the price of renewables. But it’s coming to the point now where it’s becoming very, very disruptive. There’s increasingly feedback and pushback from the local communities about having their beautiful countryside swamped with wind turbines and solar panels. In parts of the world where the solar resource is not as available, there is a tremendous amount of panels that need to be distributed to replace closing down nuclear power plants. One of the things that people don’t realize is how energy intensive nuclear energy is. It’s a very dense technology, where wind and solar are very diffuse technologies. A large nuclear power plant can provide a tremendous amount of electricity on a much smaller physical footprint than solar or wind. And that will come into play as we face the tremendous increase in the number of wind turbines and solar plants that come online.
Chris Gadomski is a nuclear energy analyst with Bloomberg New Energy Finance.