By - Jim Vess

Nuclear industry faces a bleak future without new technology or market changes, study says

Energize Weekly, July 11, 2018

The U.S. nuclear industry faces a bleak future with existing plants uncompetitive in wholesale electricity markets and no technological relief likely for another 50 years, according to analysis by university researchers.

“For entirely predictable and resolvable reasons, the United States appears set to virtually lose nuclear power, and thus a wedge of reliable and low-carbon energy, over the next few decades,” the researchers from Harvard, Carnegie Mellon and the University of California, San Diego said.

The only ways to alter the trend, their analysis said, are heightened investment in development of alternative technologies or policy changes that give added value to nuclear as a clean generating source, which does not emit the greenhouse gas carbon dioxide.

The current crop of large light water reactors, once “cash cows,” are no longer economically viable when facing lower-cost natural gas and renewable generation, according to the analysis, which was published in the Proceedings of the National Academy of Sciences.

In some cases, building new plants with this technology has been financially ruinous. The Virgil C. Summer Units 2 and 3 project in South Carolina was abandoned last year after running up a $9 billion tab. It was 40 percent completed.

Plant Vogtle Units 3 and 4 in Georgia, using the same technology, are continuing to be built with a projected cost of $25 billion, equal to $11,000 per kilowatt, the researchers estimated. That is more than five times as expensive the kilowatt cost for building a wind turbine.

“Because of their great cost and complexity, it appears most unlikely that any new large plants will be built over the next several decades,” the analysis said. “While advanced reactor designs are sometimes held up as a potential solution to nuclear power’s challenges, our assessment of the advanced fission enterprise suggests that no U.S. design will be commercialized before midcentury.”

In the meantime, the existing fleet of nuclear plants will age and in some cases, operators will seek to extend their operating lives for decades.

“The effect of running them for 60 or 80 years on the structural integrity of their components, is the subject of intense research,” the analysis said. “Even if they are deemed safe, extending their useful lives further will require expensive refurbishment and careful regulatory consideration.”

The study said that about 10 gigawatts of nuclear generation is in the process of being shut down.

Advance fission reactors are decades away, leaving factory-manufactured, light water small modular reactors (SMRs) as the only new technology that may be deployed.

The first of these SMRs, one developed by NuScale, has received a permit to be tested at the Idaho National Laboratory. Since then, 18 other vendors have approached the lab about siting their first units there.

The advantages of the SMR is that since many of components are factory made, it is cheaper and quicker to assemble. The fact that they are smaller also means that they offer an incremental approach to adding nuclear generation.

The analysis, however, finds that while an SMR would cost less than a large light water reactor, it is likely the cost per unit of power will be higher. “SMRs do make nuclear more affordable, but not necessarily more economically competitive,” the analysis said.

The researchers looked at the possibility of SMRs being used in niche markets, such as industrial processed heat, desalinization, grid backup, and they couldn’t make a business case for any of them.

“We have systematically investigated how a domestic market could develop to support that industry over the next several decades and, in the absence of a dramatic change in the policy environment, have been unable to make a convincing case,” researchers said.

One possible way to change the trend is with heightened investment and better management of U.S. nuclear policy.

The Department of Energy’s Office of Nuclear Energy (NE) is responsible for overseeing nuclear development. “NE has spent $2 billion on this effort since the late 1990s, with very little to show for it. This is unsurprising: Even by its own assessment, this amount is less than half what is necessary to demonstrate even one non-light water technology,” the analysis said.

About four dozen private companies have secured an estimated $1.3 billion in financing for private ventures, but some of these companies are not pursuing advanced fission reactors, and about a quarter of them are now bankrupt.

The other avenue to bolster nuclear development is through policies that give greater value to non-carbon technologies as a way for combating climate change. One way of doing this is putting a price on carbon emissions, the researchers suggest $100 a ton of carbon dioxide emitted within a decade.

“Our analysis suggests that in order for advanced nuclear technologies to play a role in deep decarbonization over the next several decades, more competent stewardship of nuclear innovation, substantially greater appropriations, and a change in energy markets, all very heavy lifts, will be required,” the analysis said.

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