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Tue Mar 22, 2011

Reuters News Service

While supportive of the Nuclear Regulatory Commission’s move to learn from the Fukushima emergency, Crane said the agency’s review must be timely. "We can’t afford a review that takes two years," Crane said.

New Jersey-based NRG said it remains committed to its choice of the Advanced Boiling Water Reactor (ABWR) design even though it expects some regulatory requirements to change.

Even a seemingly simple design change — such as requiring reactors on a single site to be built farther from each other — could be "fatal" to a project as far along as the South Texas Project expansion, Crane said.

"We’d have to start over with bedrock and soil studies," he said.

The plan to build new units at South Texas by 2016 was one of the most advanced amid a so-called renaissance in the U.S. atomic energy sphere, but had already run into trouble.

Last fall, NRG reduced its nuclear development spending to $1.5 million a month due to the delay in obtaining federal loan support Crane has said is critical to moving forward.

Overall spending by the partners, which had been $20 million to $30 million a month, will be cut to $8 million to $10 million, Crane said.

Tepco, which owns the damaged Fukushima plant, had agreed to invest $125 million in the Texas nuclear expansion project if it obtained federal loan support, but Crane said the status of Tepco’s involvement is now unknown as the company struggles to rebuild its Japanese plants.

Japan’s nuclear problem only makes it more difficult for U.S. developers to move forward.

"The economics were not good at all for the U.S. to build new nuclear plants given the low gas prices and the outlook for huge reserves of gas," said Jone-Lin Wang, managing director for global power for IHS CERA.

"Before this accident, the economics were a tough sell for nuclear, but you have to consider the diversity of fuel" and the expected 60-year lifespan of new reactors, she said.

While Crane said NRG will wait until late summer to decide whether to continue investing in the STP expansion, analysts have said a move by NRG to abandon the project could be positive in the long run.

NRG shares, which have risen since the March 11 earthquake, gained 14 cents on Monday, to close at $20.86 per share on the New York Stock Exchange.

(Editing by David Gregorio, Gary Hill)

March 21, 2011

By Cassandra Sweet
Dow Jones Newswire
Wall Street Jurnal

NRG Energy Inc. (NRG) and Toshiba Corp. (TOSYY, 6502.TO) said Monday they would suspend most work on their proposed Texas nuclear power plant, pending possible new safety rules.

The companies said they would continue work to obtain an operating license and a federal loan guarantee for the plant, but would suspend other work pending a review by the U.S. Nuclear Regulatory Commission of the nuclear power plant accident in Japan to see what lessons could be learned for U.S. facilities.

The NRC on Monday pursued a review of events at Japan’s Fukushima Daiichi power plant to identify potential new safety rules for the U.S. nuclear industry.

"As we unreservedly support our government’s proposed nuclear safety review, the prudent thing for us to do is to await the outcome of that review before committing more of our own or our partners’ capital," NRG Chief Executive David Crane said in a statement.

J.P. Morgan analyst Andrew Smith suggested the move might be welcome news for some investors who are concerned that NRG might be spending heavily on a project that may or may not get off the ground.

"We believe investors remained concerned about the ultimate capital outlay for new nuclear as well as the financial risk entailed in building new nuclear for NRG," Smith said.

Shares of NRG closed 14 cents higher, at $20.86, and were inactive post-market.

-By Cassandra Sweet, Dow Jones Newswires; 415-439-6468; cassandra.sweet(at)dowjones.com

March 21, 2011

Former partner in STP expansion slows work after Japan disaster.

By Tracy Idell Hamilton
San Antonio Express-News

Nuclear Innovation North America is slowing development of two additional nuclear reactors at the South Texas Project to give federal regulators and others time to assess the state of the industry in the wake of Japan’s nuclear disaster.

Work on the proposed reactors will be limited to licensing and securing the U.S. loan guarantee upon which the project depends, according to a Monday news release from NINA, the nuclear development company owned by NRG Energy and Toshiba Corp.

In conjunction with that announcement, CPS Energy CEO Doyle Beneby said the utility would indefinitely suspend talks to buy power from the proposed reactors.

"NRG and its partners stand squarely behind new nuclear power as the most important component in our transition to a low-carbon economy," said David Crane, chairman of the board of NINA and chief executive of NRG. "However, our best course of action in this immediate period of uncertainty is to minimize project (spending), continue with those activities we can control and wait until there is more information upon which we can base our long-term decisions."

The move added a degree of finality to CPS’ announcement March 14 that the parties had agreed to mutually cease talks as the nuclear crisis in Japan unfolded.

The Obama administration last week called for a comprehensive safety review of the U.S. nuclear fleet. Any design or regulatory changes stemming from that review could affect the proposed units near Bay City.

Crane said that since STP and the stricken plants in Fukushima are different, it wasn’t immediately clear whether modifications would be necessary to the existing or planned units.

"However, as we unreservedly support our government’s proposed nuclear safety review, the prudent thing for us to do is to await the outcome of that review before committing more of our own or our partners’ capital."

NRG also remains committed to a promise to shareholders that it would make a final decision about whether to continue investing in the project by this year’s third quarter, Crane said.

Before the Japanese crisis, Crane said, the company was hoping to have clarity in four areas to decide: the status of a federal loan guarantee from the Energy Department, the Nuclear Regulatory Commission’s licensing process, an agreed-upon price to build the reactors and enough customers committed to buying the power.

Not only will uncertainty remain likely for some time in those areas, he acknowledged, "now we need to have a good idea of who the owners will be."

Tokyo Electric Power Co., which owns the crippled Fukushima plants in Japan, had been expected to invest in the expansion. Given the company’s capital needs in the wake of the disaster, that’s now in question, Crane said.

But the Japanese government might still have an interest in loan guarantees since it would support Toshiba, Crane said, though he stressed that NRG has not spoken directly to the Japanese government since the earthquake. "Presumably, (the Japanese government) would be just as motivated to support Toshiba and its exports, which creates jobs," he said.

Most U.S. analysts were bearish on the economics of new nuclear development before the Japanese crisis; since then, projections have become even grimmer.

A report from Standard & Poor’s last week projects greater costs, increased oversight and "deteriorating economics" for new plant construction.

CPS has roughly $400 million invested in the expansion and owns a 7.6 percent stake in it; that would be protected if NRG decides to stop investing, said Christine Patmon, a spokeswoman with the utility. "If other partners come in, our investment remains," she said.

After many months of relative silence between the former partners, NRG approached CPS this year about buying more of the output from the proposed reactors under a fixed-price contract.

CPS was willing to listen in large part because it needs more power to replace the 851 megawatts it will lose when its Deely coal-fired plants are retired, likely by 2018.

Beneby said Monday that CPS would continue to pursue other options, including "clean coal, natural gas and big solar."

The utility is seeking proposals to build a 50-megawatt solar installation in the area, and Beneby told environmentalists this month that he has begun discussions with companies about investing in "big, big solar, maybe a couple hundred megawatts."

Suspending discussions with NRG allows CPS to devote more resources to those options, he said.

He also said the utility would not alter either its 40 percent ownership in the existing two reactors at STP or its 7.6 percent stake in the proposed expansion.

CPS is not ruling out future discussions with NRG, Beneby said, but those would start from scratch rather than continue from before the crisis.

March 21, 2011

Japan puts nuclear industry in uncertain state

By Tracy Idell Hamilton
San Antonio Express-News

Nuclear Innovation North America is slowing down development of two additional nuclear reactors at the South Texas Project to give federal regulators and others time to assess the state of the industry in the wake of Japan’s nuclear disaster.

Work on the proposed plants will be limited to licensing and securing the U.S. federal loan guarantee upon which the project depends, according to a Monday release from NINA, the nuclear development company owned by NRG Energy and Toshiba Corp.

"NRG and its partners stand squarely behind new nuclear power as the most important component in our transition to a low-carbon economy," said David Crane, chairman of the board of NINA and CEO of NRG.

"However, our best course of action in this immediate period of uncertainty is to minimize project spend, continue with those activities we can control and wait until there is more information upon which we can base our long-term decisions."

The Obama administration last week called for a safety review of U.S. nuclear plants. Any design or regulatory changes stemming from that review could affect the proposed units near Bay City.

Crane said that since the South Texas Project and the stricken plants in Fukushima are different, it isn’t clear whether modifications would be necessary to the existing or planned units.

NRG also remains committed to an earlier promise it made to shareholders that it would make a final decision about whether to continue with the project by the third quarter of this year, Crane said.

He said the Japanese crisis has added to uncertainty about loan guarantees; the licensing process; the cost to build the plant; customers committed to buying the power; and the project’s eventual ownership.

Tokyo Electric Power Co., or Tepco, which owns the crippled Fukushima plants, had been expected to invest in the expansion. Given the company’s capital needs in the wake of the disaster, that’s now in question, Crane said.

But the Japanese government may still have an interest in putting up loan guarantees, Crane said – though he stressed that NRG has not spoken directly to the Japanese government or Tepco since the earth-quake – since they would support Toshiba.

Most U.S. analysts were bearish on the economics of new nuclear development even before the Japanese crisis; since then, projections have become even grimmer. A report from Standard & Poor’s last week projects "deteriorating economics" for new plant construction.

thamilton(at)express-news.net

Saturday, March 19, 2011

By Carol Morello and Steven Mufson
Washington Post

MIDDLETOWN, PA. – Almost 32 years after America’s worst nuclear crisis at Three Mile Island, people who live in the shadow of the reactor’s cooling towers can instantly distinguish among sirens designating three different levels of alert.

The crisis here on March 28, 1979, led to "changes throughout the world’s nuclear power industry," as a state historical plaque on Route 441 notes. It also altered the mindset of this small town in central Pennsylvania, creating a permanent state of vigilance that has been heightened this past week by Japan’s nuclear catastrophe.

"What’s happening in Japan has brought back a lot of memories," said Robert G. Reid, who is still Middletown’s mayor, just as he was in 1979 when he dispatched his family to Connecticut but stayed behind to guide the town’s response. "But we’re much better prepared now than we were in 1979."

Over the decades, Three Mile Island has become a touchstone for attitudes toward nuclear power: a symbol of fear for anti-nuclear activists and of the success of emergency safeguards for nuclear supporters.

Comparisons between what happened at Three Mile Island and what is unfolding at the earthquake-damaged Fukushima Daiichi nuclear plant are inevitable. On Friday, Japan’s nuclear agency raised the severity of the crisis on the International Nuclear Events Scale from Level 4 to Level 5, the same number the United States used to classify the far less serious accident at Three Mile Island.

A different disaster

The crisis at Three Mile Island started with the venting of steam at 4 a.m., became a partial meltdown, and didn’t fully end until the last of the filtered water from the flooded containment building finally evaporated in 1993.

But there was never any loss of electrical power, no earthquake or tsunami, only a mechanical problem compounded by human error. The only explosion took place inside the containment vessel, and it withstood the blast. Water pumped in to cool the reactor stayed inside the containment structure.

While pregnant women and small children were ordered to evacuate, the decision to leave was voluntary for everyone else.

"We proved at Three Mile Island that all that [radioactive] stuff stays inside the containment structure," said Howard Shaffer, an engineer at the American Nuclear Society. "That’s why I call it the garbage can over the tea kettle. Its whole mission in life is for this event. We ran a test for that, inadvertently, at Three Mile Island."

But veterans of the Nuclear Regulatory Commission remember Three Mile Island as a time of disarray.

Victor Gilinsky, an NRC commissioner then, learned of the incident when he arrived at work March 28, 1979, a Wednesday. Staffers told him that a small pinhole in the zirconium alloy jacket around the uranium pellets used as fuel had caused overheating in the reactor, but that there was no danger.

"It was not until Friday that we realized the fuel damage might be substantial," said Gilinsky in an article on the 30th anniversary of the accident. "It was five weeks later that we learned that the reactor operators had measured fuel temperatures near the melting point on that early Wednesday morning. We didn’t learn for years – until the reactor vessel was physically opened – that by the time the plant operator called the NRC at about 8 a.m., roughly one-half of the uranium fuel had already melted."

The unexpected extent of the damage offers a window into Japan’s shattered Fukushima Daiichi complex, where Gilinsky predicts the damage inside the reactors will be much worse than expected, too. Because of the types of gases that have been emitted by the Japanese reactors, it appears likely that three of them have had substantial meltdowns of their fuel rods.

A billion-dollar cleanup

The Three Mile Island experience also suggests that the cleanup in Japan will be a mammoth undertaking.

Luke Barrett, a nuclear consultant, was involved in the crisis response and cleanup effort, which cost $1 billion. "For the first year, no human went into the containment building," Barrett said, because of the high radiation levels.

The NRC gave money to Carnegie Mellon University in Pittsburgh to develop robots that could work inside the reactor. Later, the technology was put to work in auto plants and in the cleanup of nuclear waster at Hanford, Wash., a former plutonium production site.

Japan contributed $18 million to the effort, and sent 20 nuclear engineers who spent the better part of a decade living around Middletown. Before they all went home in 1989, they donated about a dozen cherry trees as a symbol of friendship. Those trees are expected to bloom right around the March 28th anniversary of the accident.

Today, Middletown has 10,000 residents, about the same as in 1979. Some who evacuated during the crisis never returned, said the mayor. But development around Middletown, which is nine miles from the state capital of Harrisburg, has brought many more people to live in the surrounding area.

In 1979, the plant was owned by General Public Utilities (now part of Ohio-based FirstEnergy). It’s now run by Exelon, the nation’s largest nuclear plant operator with 17 facilities in three states.

"The new owners have done a good job of PR," said Reid. "They notify me if anything happens at the plant. If a fish jumps out of the water, they call me."

Trust and caution

The plant routinely tests its emergency plans, said Ralph DeSantis, a spokesman for Three Mile Island. On April 12, the company will conduct a full-scale exercise testing its sirens and the activation of emergency centers, he said.

A local citizens group maintains a network of 30 radiation monitors, and keeps in touch with plant workers, said its coordinator, Eric Epstein. It also stocks 30,000 doses of potassium iodide.

"I’d rather it not be here," he said, gesturing toward the plant. "It’s a haunting reminder of what happened here. But it’s a reality. We provide an extra level of protection."

Trust levels remain high in a middle-class subdivision that lies just across the river and a two-lane highway from the four cooling towers, two of which are working and emitting steam that wafts overhead like a cumulus cloud, visible for miles.

"I’m not afraid of the island," said Maggie Williams, a nail salon owner who met her husband, a radiology technician, when he came to Middletown to work at Three Mile Island after the accident.

The couple live so close to the plant that when her husband worked there, Williams could hear him paged on the intercom. "I figured we wouldn’t be living here if he didn’t think it was it was safe," she added as she walked her three small dogs down Meadow Lane.

Deb Fulmer, who can look up while gardening and see the cooling towers about 1,000 feet away, said plans in place now give her more confidence than she had in 1979, when she evacuated with a four-week-old baby in her arms.

"The fear comes from not having a plan when something happens, for what to do, where to go, what the sirens mean," she said. "Now we know."

Yet Fulmer, a nurse who helps in disaster zones and expects to go to Japan eventually, is unsure where she placed her potassium iodide pills. And she had to search to locate the evacuation routes in the phone book, because she hasn’t looked for years.

The lessons of Three Mile Island, she said, are: "Have a plan. And you’ve got to trust [that] your government is going to get you outta here."

Anti-nuclear sentiment

Others, however, are more wary.

Mary Osborn, who lives almost seven miles away, has become an activist against nuclear power, joining the dwindling number of demonstrators who show up every anniversary at 4 a.m. outside the plant’s gates.

She keeps scrapbooks with photos of mutated flowers, vegetables and deformed animals that she attributes to the 1979 radiation release. She said she tasted metal in the air the morning of the accident, and has long suspected that a growth on her neck that she had removed was due to that.

The television in her living room has been turned to CNN nonstop since the Japan nuclear crisis began.

"This week, it’s like TMI never stopped," she said, wearing a "They Lie" T-shirt adorned with "No Nukes" buttons and the badge her ex-husband wore when he helped build the plant. "It’s been a nightmare."

NRC historian J. Samuel Walker said epidemiological studies of some 32,000 people who lived within a five-mile radius of the reactors have shown no increased incidence in cancer that could be attributed to radiation releases from the accident.

But some residents are skeptical. "We have friends who got colon cancer and have no history of it in the family," Bonnie Blocher said as she prepared to get her nails done at Williams’s home salon. "How do we know the studies were accurate?"

Walker’s view is that during the 1970s, "proponents of nuclear power had underestimated the risks of a severe accident and that nuclear critics had overstated the likely consequences."

Improvements in reactor design and performance — as well as concerns about climate change — have boosted support for nuclear power. But Walker warned against complacency.

"Before the accident, nuclear experts were confident that they had solved the most important reactor safety issues," he has written. "This confidence and the complacency it fostered were shattered on the morning of March 28, 1979."

mufsons(at)washpost.com
morelloc(at)washpost.com