A Tale of Two Reactors
Have you noticed a lot of articles lately about how good nuclear power is for the environment, especially as an answer to climate change? The Nuclear Energy Institute (NEI), the trade and publicity group for the industry, is running a full court press on this topic right now.
You can always tell an article based on NEI talking points. It invariably starts out by calling nuclear energy carbon free – it’s not. No form of energy is. See https://timeforchange.org/co2-emission-nuclear-power-stations-electricity for more details about energy generation and greenhouse gases.
An NEI inspired article will then go on to make light of the storage of high level radioactive waste assuring readers this is a small problem because the waste is so dense it does not take up much room. The amount of space sometimes cited is supposedly equal to two football fields. Of course this ignores the problem of criticality and how close you can crowd high level radioactive waste like spent fuel rods together before they begin their own uncontrolled fission process – a/k/a an explosion. In reality the storage of high level radioactive waste that is deadly for 240,000 years is a huge problem that has no answer and is not addressed by any sort of national policy. Storage on site is now standard with most companies moving irradiated fuel rods from fuel pools into dry cask storage on site and pressing for Centralized Interim Storage or parking lots full of casks on what is frequently Native American land or communities of color where they can be dumped and forgotten about.
NEI based articles totally ignore uranium mining and the effect it has on the miners, the land and how what is essentially rock is processed into fuel for reactors. It is an ugly story best kept under wraps if you are touting nuclear power. You may also read a lot about the next generation of reactors – Gen 3 or AP1000, as they are fondly referred to in NEI circles. Gen 3 reactors were designed to be assembled cheaply because, in theory, different parts could be made by different companies and then assembled on site at a great savings. This theory did not work out well in practice.
There is a two word answer for the idea of nuclear power as an answer to climate change. Those two words are Vogtle and Summer, the last reactors to start construction in the United States. After all, if you are going to build a lot of reactors to save the planet, it makes sense to look at the track record of new construction. No matter if it is a large 1,200 MW reactor or one of the Small Modular Reactors that are being pushed as the greatest new nuclear trend, the industry has a construction record that deserves to be examined Vogtle, in Georgia, was one of the sites chosen to prove that the nuclear industry could come roaring back and that nuclear power was not only viable but headed toward a renaissance. V.C. Summer in South Carolina, a near twin to Vogtle, was the other site and was planned as the first reactor to be constructed in the United States in 30 years.
In 2009 Vogtle was expected to cost $14 billion for two reactors and was to be finished by 2017. The project is still under construction and not expected to be completed until late 2020, if then. Meanwhile the cost has escalated to more than $27 billion dollars. There are no guarantees that either of these figures will hold and there is no cap on construction costs which some investors have asked for. Ten years behind schedule, $13 billion over budget and counting. For a time line and more gory details see https://www.ajc.com/business/after-wrangling-over-georgia-nuclear-plant-cost-concerns-remain/9iGHX9Ugo7QPkli9LoqGbM/. For a summary, scroll down in this article.
The story for the reactors at the V. C. Summer site in South Carolina is even more instructive. Construction started on V.C. Summer in 2008 for two of the newest and supposedly best type of reactor, the AP 1000. The cost was estimated at $9.8 billion, an unrealistically low price for two reactors. Unit 1, which had opened years before, was already operating on site. The new Unit 2 was expected to begin operation in 2016 and the new Unit 3 in 2017. Three days after the start of construction the two utilities doing the building, South Carolina Electric and Gas and Santee Cooper, made the first of nine requests for a rate increase. What followed was a remarkable story of incompetence, fraud and lies. By 2017 it was all over. Not only did the state back out of the deal, some of the people in charge of the nuclear project seemed likely to go to jail. Westinghouse declared bankruptcy, 5,600 workers were laid off, and South Carolina was left with a $10.2 billion hole in the ground plus a warehouse full of new nuclear parts destined never to be used in South Carolina. For the complete story and timeline see https://www.chooseenergy.com/news/article/failed-v-c-summer-nuclear-project-timeline/. For a summary, see below.
The story of these two reactors is not unique in the nuclear industry or to this country. The French/German reactor design was called European Pressurized Reactor, the internationalized name was Evolutionary Power Reactor, but it is now simply named EPR. EPR suffered the same fate and in 2018 the French environment agency, Ademe, “found that the economic case for renewable energy is stronger than that for new reactors, dealing a blow to plans by the French government and energy company Electricité De France SA (EDF) to build a new generation of European Pressurized Water reactors or EPR’s.” See www.globalconstructionreview.com.
It does not seem to matter what kind of reactor is being built, or where it is being built, construction delays and cost over runs for nuclear reactors are part of the picture. Given this history, it is difficult to understand why anyone except the most diehard nuclear fans could put any faith in the industry’s latest brain child, the Small Modular Reactor. The difference between a large civilian reactor and a small modular one is very similar to the difference between a Great Dane and a Chihuahua. They are both dogs and in many ways require similar care – one just produces a lot more poop than the other. Even if it is a Chihuahua it still makes waste that has to be cleaned up at some point.
To a student of nuclear history it is clear that it is not possible to build enough new reactors to have a significant impact on the climate in the time we have left. The energy market is in rapid transformation worldwide and there is no longer a need to choose anything that is not clean and green or to endorse a government policy that does not support these values. Anything else is a waste of public dollars and the time we need to help us dig our way out of rising temperatures and global catastrophe.
Some Background Information on V.C. Summer
After the grand opening in 2008 in Fairfield County, South Carolina, all sorts of delays and problems ensued, including legal ones. The most important reason for delay was “attributed to the fabrication and delivery of structural modules.” In other words the pieces that had been contracted out didn’t fit together quite right, just like the situation at Vogtle. The completion date was pushed back to 2018 and 2019. Extra project costs of $1.2 billion were announced at the same time. Lawmakers began to get nervous as constituents started asking how this could have happened and who voted to approve a deal that was clearly not in the interest of ratepayers. The two utilities involved, South Carolina Electric & Gas (SCE&G) and Santee Cooper, commissioned the Bechtel Report, to answer these questions. See the entire report at www.world-nuclear-news.org. The results were kept secret for two years. New rate hikes were approved and completion dates were pushed back to 2020 for both reactors.
Four years later in 2017 it was all over. Westinghouse filed for bankruptcy citing a $9 Billion loss associated with both Vogtel and V.C. Summer. SCE&G and its parent company SCANA announced that they were abandoning the project after Santee Cooper ceased construction and sent 5,600 workers home without pay. They then asked the South Carolina Public Service Commission to allow rate payer charges for the $4.9 Billion they had already spent on construction. This was on top of the $27.00 a month rate payers were already being charged for construction of the nuclear project. On September 4, 2017 Santee Cooper was finally forced to give Governor Henry McMaster a copy of the Bechtel Report with the proviso that he keep it secret for proprietary reasons. The report outlined Westinghouse’s failures and accused the utilities of insufficient oversight. Rumor has it that the report was allegedly in the Governor’s hand for approximately 15 minutes before he sent it out to every news outlet in the State.
At this point things got really complicated. Legislators pointed fingers at each other and held hearings; court cases were started. SCANA customers sued over their high electricity rates and received $115 million dollars that had been earmarked for SCANA executives as a performance bonus. Dominion, a large energy corporation, stepped in with an offer to purchase SCANA and all three reactors on the V.C Summer site; albeit with conditions. They were willing to give SCANA’s customers an “up to” $22.00 a month rate cut but required the average household to pay an additional $1,600 over the next 20 years for a total of $2.3 billion for the failed nuclear construction project. The Governor, the Speaker of the House and the Attorney General supported the Dominion deal. The Nuclear Regulatory Commission (NRC) approved the license transfer to Dominion. Lawyers agreed to settle out of court if the deal went through. The Public Service Commissioners debated, but did not find sufficient evidence that the utility had lied in order to keep the struggling project alive. Lawyers representing former SCANA shareholders did not agree.
“The bottom line is they (SCANA executives) lied to everyone, and they did it intentionally,” attorney John Browne told U.S. Judge Margaret Seymour. The cost was tremendous, said Brown, whose lawsuit argues shareholders lost some $2.7 billion in stock value when the company’s stock price plummeted. For more on this pending case see https://www.thestate.com/news/local/crime/article227087214.html.
Environmentalists at the final hearing were outraged and shouted “Dominion buyout, more of the same, we want solar for a change.” Their chants fell on deaf ears as the Commissioners walked out of the room and the State of South Carolina was left with a $10.2 billion hole in the ground and a warehouse full of millions of dollars of nuclear parts destined never to be used in South Carolina.
Some Background on Vogtle
First and foremost, understand that the utility Georgia Power Company (GPC) owns Georgia and has deep pockets. The Georgia legislature frequently acts like a wholly owned subsidiary of the power company and nothing happens on a statewide basis without the approval of GPC. The idea of a nuclear renaissance had been talked about before but this time it was to be led by the State of Georgia and in 2007 it was something GPC was pushing. By 2009 sources of funding had been lined up, contracts had been signed and work was ready to commence. Funding proved a bit tricky since the private sector declined to be involved. It was finally settled that the Department of Energy would fully back the project with the necessary funds and in an unprecedented move would dispense with the normal investment generally required from the utility. Westinghouse, one of the best known companies in America was heavily involved. A Florida utility, Jackson Electric Authority, was brought into the deal. Buried in their contract was a stipulation that they were locked into this deal and could not withdraw unilaterally. There were a few other stipulations that in hindsight seemed a bit odd such as an obligation to keep paying even if the reactors were never built. In the haste to get started these items were waved aside as immaterial. What could possibly go wrong in a deal backed by Georgia Power Company? Simply put, two reactors would be built and operating by 2014 at a cost of $12 billion, plus a substation for a total cost of $14 billion. It seemed like a good deal for the time. Georgia Power Company wanted this project to go forward and who was it that could tell them no?
Actually, there were some activists in the region from the Southern Alliance for Clean Energy or SACE that tried. They pointed out that ratepayers would be paying for electricity from the plant before it was even constructed. They noted that ratepayers and other investors were obligated to make payments even if the reactors were never built. They also pointed out the changes that were beginning to take place in the electricity market and the falling cost of renewables. They were laughed out of town on a rail.
And so construction started. Eventually, between 5,000 and 6,000 people were working on the site at any given time and politicians were quick to take credit for the jobs and prosperity. According to the new licensing agreement of a combined operating and construction permit which industry had requested from the NRC to speed up work, pieces and parts for the reactor were bid out to different companies. Unfortunately, when the different parts were delivered they did not quite mesh. While everything could be within definitive specifications, there was enough of a margin that the parts and pieces did not fit together perfectly after all. Work packets were submitted that were unbuildable and changed by engineers on-site daily. While changes from a design basis were difficult under the old system, the new system of combined operating and construction license made it much easier to try to fix problems. Change orders flew right and left. Engineers were literally building the plant on the fly. One can only wonder where the NRC inspectors were and what they saw.
Deadlines came and went, always with assurances that salvaging a working reactor was just around the corner. Georgia ratepayers had a $5.00 surcharge added to their bill whenever more money was needed. Georgia state law specified that all of the companies involved in this operation would get a 10% return on their investment no matter what happened. Senior executives received their bonuses and deadlines were extended time and time again as costs soared. Finally Georgia Power Company had to ask their partners in the project for an additional $2 billion increase and has extended the completion date for the reactors by another four years. There is no guarantee that rate payers are immune from additional increases and there is no final cap on the cost of the project which some investors had asked for. The Florida utility which was part of the original deal fired its CEO and Board of Directors and is now in court alleging that they should not be held to the original agreement since it was unconstitutional. They are petitioning the court for permission to withdraw from the agreement which could imperil the whole construction deal. Should they win this case, it is likely that other partners would elect to do the same. This could make the Department of Energy (DOE) responsible for $6.5 billion in loan guarantees to Georgia Power Company, plus an additional $1.8 billion to the Municipal Electric Authority of Georgia.
In short, in 2009, Vogtle was slated to cost $14 billion and be finished by 2017. Currently the project is not expected to be completed until late 2020 at a cost of more than $27 Billion. Neither cost nor completion date is guaranteed. As of now, Vogtle is 10 years behind schedule and $13 billion dollars over budget.
To a student of nuclear history it is clear that there is not enough money or time left to build the number of new reactors necessary to have a significant impact on climate change in the short amount of time we have left. In this time of rapid energy transformation there is no longer a need to choose anything that is not quick and cheap to construct if we are to get the most out of each dollar. New electricity generators must be clean and green in support of a national policy geared to fight climate change. Anything else is a waste of public dollars and the time we need to help us dig our way out of rising temperatures and global catastrophe.
Editor’s Note: The Trump Administration has closed on new loan guarantees for Southern Company’s Plant Vogtle, the nation’s lone nuclear construction project. The $3.7 billion in loan guarantees represent a new lifeline for the two proposed reactors, which are years behind schedule and billions above their original projected budget. Energy Secretary Rick Perry formally signed off on the agreement when he visited Vogtle. And yet, even with all of the federal back up, financial problems remain, and new problems have come up.
# # #
Marilyn Elie, Indian Point Safe Energy Coalition. Direct email to: firstname.lastname@example.org