Nuclear Industry Tries to Make a Comeback : Energy: Despite soaring oil prices, the outlook for new plants is bleak. But the industry sees several helpful developments on the horizon.
Even before Iraq invaded Kuwait, sending oil prices soaring, America’s nuclear power industry was on the offensive. Its advertising, already scheduled to run in several national magazines, showed a menacing cobra whose body was made of oil drums. The message: Continued U.S. reliance on foreign oil is dangerous.
When Iraqi tanks crossed the border, the U.S. industry was ready. Within two weeks, the ad campaign was expanded to 18 major daily newspapers, at a cost of $150,000. But the extra spending--and the discomfort of rising oil prices--marked only a small and temporary blip in the $6-million-a-year media campaign by the U.S. Council on Energy Awareness, an arm of the nuclear power industry, to revive the long-dormant business of building power reactors.
Rather than rely on Iraqi President Saddam Hussein, suppliers of nuclear power are placing their bets on longer-term hopes: continued steady growth in electricity demand and new designs for reactors that are cheaper to build and easier to operate.
“Our policy is pretty much ‘steady as she goes,’ ” said council spokesman Carl Goldstein. Indeed, analysts say, there may be no other viable strategy for an industry that hasn’t received a new construction permit since 1979.
Nuclear power provides 19.5% of the nation’s electricity. But these days the industry makes its domestic profits doing repairs and maintenance on existing plants rather than designing and constructing new ones.
There are 114 operating plants, but only nine under construction--and only two of those have firm completion dates. “There simply are no more in the pipeline,” said Frank Ingram, a spokesman for the federal Nuclear Regulatory Commission. “We suspect several of (the plants under construction) may never get finished.” Meanwhile, Ingram noted, the agency is concentrating on making sure that existing reactors run safely.
The major reason that the utility industry has shunned new orders for reactors is that it simply takes too long--usually a decade or more--before a utility can win final approval from regulators to begin operating a new nuclear power plant.
Prospective customers for nuclear power plants do “not trust the regulatory system on (both) the state and federal levels,” said Goldstein of the Council on Energy Awareness, whose membership consists of utility companies, equipment manufacturers and builders of power plants. “They have no confidence that if they make investment decisions, these will be supported when the plant is built,” he explained.
Indeed, in many areas, state regulatory bodies are prohibiting utilities from increasing their prices to help pay for nuclear power plants, effectively forcing them to take the construction costs out of their profits. During the 1980s, the amount of construction costs that public utility commissions refused to include in rate-setting totaled a staggering $15 billion.
Although the nation’s appetite for electricity keeps rising--it has jumped 54% in just seven years--the future of nuclear power looks comparatively bleak.
California, with nearly 30 million people the nation’s biggest state, gets 14% of its electricity from nuclear power plants, but prospects are virtually nil that more will be built there. State law forbids licensing of new plants until there is a demonstrated safe method of disposing of nuclear waste. And the federal Energy Department isn’t expected to complete its work on waste disposal methods and site selection until well into the next century.
“I don’t see nuclear power representing a viable option in the foreseeable future,” said Charles Imbrecht, chairman of the California Energy Commission.
Even if the waste-disposal problem is solved, the high cost of building nuclear power plants--and lingering questions about their reliability--still pose massive obstacles, Imbrecht said.
Nuclear power “commands an enormous amount of capital over a long period of time and is simply not going to attract customers” unless the technology becomes more competitive, he said. If it has any future at all, he asserted, it lies with smaller-sized plants--not the behemoths that were built in the 1960s and 1970s.
Imbrecht insisted that California’s diverse sources of power--from natural gas, underground steam fields, hydroelectric power and purchases of electricity from other regions--have made the state less vulnerable to foreign interruptions. Only 1% of California’s electricity is generated by oil, down from a whopping 48% during the 1973 Arab oil embargo against the United States. There is “absolutely no danger of the lights going out in California any time this decade,” Imbrecht asserted.
As a result, even nuclear power enthusiasts don’t foresee any easy expansion. “Clearly, we favor nuclear power,” said Tom Dennis, Southern California Edison’s Washington representative. The company’s nuclear power plant at San Onofre “has a great record,” he asserted.
Dennis said Southern California Edison has been bullish on nuclear power, “and we think it can work.” But he conceded that even the crisis in the Persian Gulf won’t move Congress to ease the licensing process. “I doubt any fast-tracking will be done as a result of what takes place in the Middle East,” he said. “I don’t think the crisis will result in anything but a clearer recognition that there needs to be a national energy policy.”
Strategists at the Pennsylvania Power & Light Co. say they believe that the United States needs both coal and nuclear power to meet its future energy needs. But Herb Woodeshick, special assistant to the company’s president, said it would take major regulatory reforms to persuade the nation’s utility industry to construct new plants.
Among them: A one-step licensing process to replace the separate construction and operating permits now required, resolution of the waste-disposal issue and a standard new design for nuclear plants. “When someone starts to build a plant, you need to be sure it can be done in six or seven years,” Woodeshick said.
With even its friends still reluctant, the nuclear power industry recognizes that it is unlikely to make a comeback any time soon, even in the face of the gulf crisis.
“Our campaign is consistent, our message is clear--that imported oil is dangerous,” Goldstein said. “Fortuitously, our latest series of ads fit right into the world situation.”
Goldstein emphasized that, every day, nuclear power displaces the use of 740,000 barrels of oil in producing electricity--about the same amount that the United States imported from Iraq and Kuwait before the crisis began.
Only 6% of America’s electricity is generated by burning oil, but almost 20% of total generating capacity is oil-fired, he warned. “If utilities had no other choice but to use this spare capacity,” he said, “oil consumption could shoot up as much as 3 million barrels a day.”
Despite the industry’s pessimism, there are some changes on the way:
* Analysts expect that a new generation of nuclear reactors--a standard design that would be far less complex and easier to operate--will be certified by 1994, or possibly sooner.
* The Nuclear Regulatory Commission has adopted a proposal recommending a single-permit procedure to replace the current two-step system. But industry officials believe that they will need new legislation to make the procedural changes unassailable to challenges, and Congress is likely to balk at such a plan.
* The industry hopes to wage its future public relations battles partly on environmental grounds, arguing that nuclear energy is clean and emits no “greenhouse gases.” “Our polls show environmental concerns are more telling than energy issues,” Goldstein said.
If the industry is politically skillful--and lucky--utilities may be ordering new plants by the middle of the decade, Goldstein suggested.
But an air of pessimism still prevails. A publishing and economic consulting company has scheduled a conference in Washington later this month on the theme of standardization of nuclear power plants. “Can it save the nuclear industry?” the program asks.
THE NUCLEAR POWER INDUSTRY AT A GLANCE
Plants with operating licenses: 114
Plants under construction: 9
Last construction permit issued: 1979
Share of U.S. electricity produced by nuclear power: 19.5%
