Author Archive

March 5, 2010

Karen Hadden, Guest
Corpus Christi Caller-Times

CORPUS CHRISTI – Heavily subsidized by taxpayers and ratepayers, nuclear power is susceptible to delay, cost overruns and significant environmental risks. Investing billions into more nuclear power threatens to derail funding that would be better spent on energy efficiency and safer, cleaner renewable energy.

Moody’s advises investors that nuclear projects frequently lead to financial crunch and credit rating drops. The two South Texas Project reactors proposed for the existing Bay City site were supposed to lead the so-called "nuclear renaissance," but there has been strong citizen and legal opposition and the cost has already skyrocketed. Estimates now exceed $18 billion, three times original projections. No shovel has yet been turned and no license granted.

Maybe you remember the massive boondoggle when the South Texas nuclear reactors ran six times over budget, were eight years late coming online, and were plagued with mismanagement, construction problems and lawsuits. Think déjà vu.

South Texas Project partners NRG and San Antonio municipal utility CPS Energy have not seen eye to eye. For more than a year a buyer was sought for a portion of the increasingly expensive reactor project, but none surfaced.

When CPS hid a $4 billion cost increase from the public for half a year, the backlash led the company to court to clarify terms for pulling out of the project. A settlement agreement now halts further CPS nuclear investment and shrinks its original 50-50 reactor share by 85 percent. The lesson: Nuclear reactors are simply too risky and too costly.

The good news is that effective and affordable energy solutions are already in place, growing and improving. Wind is a huge success story for Texas. We now lead the nation in wind power. Last October, a record was hit when wind accounted for 25 percent of the state’s electric generation.

Texas is perfectly positioned to demonstrate similar leadership on the solar front. Solar technology is advancing and costs are plummeting. Stimulus funding will help. We have a huge opportunity to develop new clean energy industries and create local jobs – if we do things right.

For example, West Texas wind that comes in at night can be perfectly paired with solar energy generated during the day. Natural gas and energy storage can bridge the gaps between them. Preapproved transmission is helping new wind and solar projects move forward. Geothermal power systems can help heat and cool homes. And "smart grid" technology will lessen the need for clunky baseload plants – the outdated cement trucks of the energy world. It’s time for zippy and flexible energy vehicles that can ramp up or down quickly to meet changing demand.

Energy efficiency is reducing electric demand. New homes and businesses are being built to use less energy and save on electricity bills. New legislation has allowed for better financing of energy upgrades. Those who wisely make improvements will be free of ongoing debt should they decide to sell their home.

In the end, who will want expensive nuclear power when more affordable options are available? Industrial customers want short-term, flexible energy contracts, not long-term burdens.

Texas ratepayers are at huge financial risk if NRG continues down the nuclear path. Luminant also seeks to build two more reactors. Their reactor design for Comanche Peak has never been built anywhere in the world. It’s time to drop expensive and risky nuclear power. We should pursue affordable energy efficiency first and then tap the free power of Texas’ sun and wind.

Karen Hadden is the executive director of the Texas based Sustainable Energy & Economic Development (SEED) Coalition. She can be reached at (512) 797-8481. Copyright (C) 2010 by the Texas Lone Star Forum, Austin.

February 24, 2010

By MATTHEW L. WALD
New York Times

MONTPELIER, Vt. – In an unusual state foray into nuclear regulation, the Vermont Senate voted 26 to 4 Wednesday to block a license extension for the Vermont Yankee nuclear plant, citing radioactive leaks, misstatements in testimony by plant officials and other problems.

Unless the chamber reverses itself, it would be the first time in more than 20 years that the public or its representatives decided to close a reactor.

The vote came barely over a week after President Obama declared a new era of rebirth for the nation’s nuclear industry, announcing federal loan guarantees of $8.3 billion to assure the construction of a twin-reactor plant near Augusta, Ga.

Vermont Yankee’s recent troubles are viewed by some as a challenge to arguments that reactors are clean, well run and worth the enormous investment involved in building and operating them.

In a small, ornate chamber packed with plant opponents, the state lawmakers voiced frustration over recent leaks of radioactive tritium at the 38-year-old plant as well as the collapse of a cooling tower in 2007 and inaccurate testimony by the plant’s owner, the Louisiana-based nuclear operator Entergy. Plant officials had testified under oath that there were no underground pipes at Vermont Yankee that could leak tritium, although there were.

Experts tracking the leaks have found no evidence that the substance has entered the drinking supply or harmed a human being.

Lawmakers at Wednesday’s session also voiced doubts that Entergy would have enough money to decommission the plant in view of the costly tritium leak and other troubles.

"They’ve been their own worst enemy," said Robert Starr, a Democrat from the town of North Troy, although he proposed sending the bill for study to another committee. That vote failed 24 to 6.

In the decisive vote, senators defeated a resolution that would have authorized the state to issue a certificate of "public good," which would be necessary to keep Vermont Yankee operating.

Under Vermont law, any extension of the plant’s license beyond 2012 would have to be approved by both houses. So unless the Senate reverses itself and the House also approves an extension, the plant would have to close by March of that year.

The controversy in Vermont is viewed with deep apprehension and some anger by the nuclear industry. The Nuclear Regulatory Commission in Washington, which normally calls the shots on plant safety issues, has been poised to give the plant another 20 years. Commission officials have declined to comment on Vermont’s action. The last time a reactor in the United States was closed by a vote of the public or its representatives was in June 1989, when the voters of the Sacramento Municipal Utility District decided to shut the Rancho Seco reactor. The issues in that case were mostly economic; the plant kept breaking down, forcing the district to buy electricity from neighbors, and had been shut from December, 1985 to early 1988 for repairs.

Popular referendums to close reactors have been brought in several states but always failed. But several old reactors – including Maine Yankee, in Wiscasset, Me., Connecticut Yankee, in Haddam Neck, and Yankee Rowe, in Rowe, Mass., were closed by their owners because they had expensive safety problems and were not very profitable. The Yankee plants were of different designs but were owned by overlapping partnerships of New England utilities.

Commissioned in August 1966, and given its operating license in March 1972, Vermont Yankee is one of the older plants in the American inventory of 104 power reactors. The oldest still running is Oyster Creek, near Toms River, N.J., which is of a very similar design and opened in December, 1969.

It recently won a 20-year extension of its initial 40-year license although, to the indignation of its opponents, plant owners announced a few days after the renewal that it also was leaking tritium.

Although the Nuclear Regulatory Commission is supposed to have sole authority to regulate safety issues under a 56-year-old federal law that was intended to encourage the growth of civilian use of nuclear power, Entergy gave the state of Vermont a opening in 2004 when it bought the plant from a group of local utilities.

It agreed in a memorandum of understanding that the state’s "certificate of public good," a state-issued permit that all power plants must have, would expire with the original 40-year license and that another certificate would be required.

Then the plant went through a series of problems, including the collapse of the cooling tower in August 2007. The Nuclear Regulatory Commission said the three-story wooden tower, one of several, was not required for the safe shutdown of the plant and that its collapse was not a safety failure, but the distinction did little to buff the plant’s image.

In a move that has also deepened unease, Entergy has been trying to spin off the reactor and five others, including the Indian Point reactors in New York, into a new company that would borrow money to pay back Entergy and sell stock on Wall Street. Many opponents in Vermont worry that this would allow Entergy, based in New Orleans, to avoid legal liability for any problems at the plants and that a spinoff could be detrimental to the state.

"It’s a dump job," said Nancy Braus of Putney, a plant opponent who watched the Senate action from a corner of the chamber. She pointed out that the estimates of the cost of decommissioning the plant run over $1 billion, roughly the amount of the entire annual state budget, and that Entergy has only about $450 million on hand.

The tritium leak is an especially sore point. While there is no evidence that it has entered the drinking water or given any human being a dose of radiation, legislators were dismayed that plant officials had testified that there were no underground pipes at Vermont Yankee that the substance could escape from.

Before Senate debate began Wednesday morning, Entergy said it had instructed a law firm to examine the misstatements under oath and had concluded that officials had not intended to deceive the state. It said that communications had "led to misunderstandings" and had been taken out of context. The result, the company said, was that "the responses were incomplete and misleading."

Curt Hebert, a spokesman for the company, said Entergy had put five senior employees on administrative leave and that "all the discipline taken had financial consequences for the employees involved."

Mr. Hebert acknowledged in an interview that the leaks, the cooling tower collapse and other problems had been "almost a perfect storm" for the plant.

Adding to the uncertainty, all the members of Vermont’s Senate and House face re-election in the fall, and there will be a new governor next year as well.

Some plant supporters have raised the possibility of a lawsuit should the two houses decline to extend Vermont Yankee’s operating license next year.

But Christopher M. Kilian, director of the Vermont office of the Conservation Law Foundation, said that because of the structure of the law, requiring affirmative action of both houses for the plant to stay open, a suit would face difficult hurdles.

"There will not be an act of the legislature for anyone to challenge," he said.

February 17, 2010

By Cassandra Sweet
Wall Street Journal

A nuclear-power venture owned by NRG Energy Inc., Toshiba Corp. and a Texas utility resolved a legal dispute Wednesday that allows one of the first new U.S. nuclear-power projects in decades to proceed.

The agreement, between the joint venture, Nuclear Innovation North America, and San Antonio municipal utility CPS Energy, reduces the utility’s stake in the south Texas nuclear power project to 7.6%, from 50%, with the joint venture retaining 92.4%, according to CPS and NRG.

The agreement ends a $32 billion lawsuit that CPS filed in December to reduce its participation in the project, and allows development of the plant to proceed, the companies said.

The project is part of a wave of new nuclear power plant development for which the Obama administration has expressed support as a way to fight climate change and meet growing U.S. energy demand. Unlike power plants that run on fossil fuels like coal and natural gas, nuclear power plants don’t produce significant greenhouse-gas emissions that have been blamed for contributing to climate change.

"With this agreement, we can continue developing one of the leading nuclear power projects in the country," said NINA Chief Executive Steve Winn.

The agreement also resolves ownership issues that might have held up an application the companies filed for federal loan guarantees, said NRG spokesman Dave Knox. If the companies get the federal loan guarantees, NINA, which is 88%-owned by NRG and 12%-owned by Toshiba, has agreed to pay CPS $80 million and donate $10 million over four years to its residential customer assistance program.

CPS said its remaining stake in the project is worth about $1 billion. The agreement requires CPS to help with the project’s loan guarantee application, but excuses the utility from spending more money on the project. The utility has said it has spent about $370 million on the project’s engineering and permitting.

"This agreement extracts the maximum value for our community at this stage of the project’s development," CPS Acting General Manager Jelynne LeBlanc Burley said in a statement.

The settlement requires approval by the CPS board, which could make a decision as early as Monday.

The project, estimated to cost between $9 billion and $12 billion, would add two new nuclear power units to an existing nuclear reactor, expanding the facility by 2,700 megawatts, enough power for more than 2 million homes.

CPS sued NINA in December, alleging that NRG misled the utility on project costs and saying it might withdraw. In January, after initial negotiations failed, NRG Energy Chief Executive David Crane said the company would exit the project and suffer a $400 million write-off if the dispute couldn’t be resolved.

The two sides agreed before the dispute to each sell a 10% stake in the project, but uncertainty around CPS’s involvement has stymied these efforts. Tokyo Electric Power Co. said last month it’s considering purchasing a stake in the project and remains interested.

–Mark Peters contributed to this article.
Write to Cassandra Sweet at cassandra.sweet(at)dowjones.com

For Immediate Release:
Feb. 22, 2010

Contact:
Eliza Brown (512) 637-9482
Angela Bradbery (202) 588-7741

Agency Is Refusing to Adhere to an Order to Release Document That Would Help Determine Safety of New Nuclear Reactors

Download this release in pdf format for printing.

WASHINGTON, D.C. – The Nuclear Regulatory Commission (NRC) should stop balking and provide a critical document that would reveal how the owners of a Texas nuclear plant expansion project plan to deal with a fire or explosion, three public interest groups told the commission late last week.

Three administrative judges of the Atomic Safety and Licensing Board have ordered the agency to provide at least a redacted version, but NRC staffers have refused. The NRC’s lack of transparency could impact the ability to get adequate safety-related information not only about the South Texas Project (STP) but about other proposed reactors around the country as well.

Late Friday, the groups – the Sustainable Energy and Economic Development (SEED) Coalition, Public Citizen and the South Texas Association for Responsible Energy – filed a brief with the NRC. It noted that the NRC staff’s refusal to provide the information violated President Barack Obama’s new transparency policy. The groups also said the NRC is acting arbitrarily and trying to shut the public out of NRC proceedings.

"After the Sept. 11 attacks, Congress required new fire and safety standards for all new plants and the NRC developed rules to reflect this. Now, the NRC is trying to do its work behind closed doors, and its staffers are literally making up how to handle information as they go along, keeping as much secret as possible," said Karen Hadden, executive director of the SEED Coalition. "Without disclosure of this information, we can’t tell how well the NRC is doing in protecting the public."

Friday’s filing was the latest in a regulatory battle that began in April 2009 when the three groups intervened in the licensing of two new reactors at the STP in Matagorda County in southeast Texas. The groups contend that the application for a license is inadequate.

The NRC has a new rule that requires licensees to develop and implement guidance and strategies to protect nuclear plants from explosions or fires, including those that would result from the crash of a large commercial airliner. By signing non-disclosure affidavits, the groups gained access to STP’s plan to comply with this rule and nuclear industry guidance on how to adhere to it.

On Aug. 14, the groups filed new "contentions" that STP was not adhering to the new fire safety rule.

Then, in October, the NRC posted on its Web site the existence of a draft document, referred to as ISG-016, which provides guidance to nuclear plant operators as to how to comply with the new fire safety rule. The NRC maintains that it is not a public document because it contains security-related information. The agency has created a new classification of document, called "sensitive unclassified non-safeguards information," or SUNSI, and said that records in this classification, including ISG-016, are exempt from disclosure.

In November, the three public interest groups asked for the document but were turned down.

They appealed to the Atomic Safety and Licensing Board, which on Jan. 29 ordered the NRC staff to provide at least a redacted version of the document. In the order, three administrative judges chastised NRC staff for imposing unwarranted burdens on the groups and for misapplying procedures. Further, they noted that requirements to access the document should not be more stringent than the Freedom of Information Act and told the staff to go through the document, paragraph by paragraph, to identify the sensitive, non-public information, and provide the rest of the information to the groups.

The NRC appealed the order, which prompted Friday’s filing.

"It is crucial for the public to be able to participate in the licensing of new nuclear reactors that may be in its backyard," said Tom "Smitty" Smith, director of Public Citizen’s Texas office. "We cannot meaningfully participate in the licensing of the STP reactors if we can’t get adequate safety information, and that includes whether these new reactors will be able to withstand a commercial jet crashing into them."

Hadden noted that "the ability of the public to participate in licensing proceedings is particularly critical as the Obama administration is in the process of granting loan guarantees for new nuclear plants – the first to be built in the U.S. in decades."

Last week, the administration announced an $8.3 billion loan guarantee for Southern Company to build two new reactors at its Vogtle plant in Georgia, and the administration has asked Congress to expand the program from $18.5 billion to $54 billion. The owners of the planned STP reactors – which include NRG Energy, Toshiba, CPS Energy – are seeking federal loan guarantees as well.

"The NRC wants to barrel along and license these plants with blinders on and without any involvement by the public," Hadden said. "Well, the public has a right to be involved. People need to know what is being built in their communities and how safe it will be."

A copy of the groups’ filing is available at
nukefreetexas.org/downloads/intervenors_response_opposition_brief_ lbp_10_02.pdf.

The Atomic Safety and License Board order is at
nukefreetexas.org/downloads/nrc_public_order_012910.pdf.

February 17, 2010

By Tracy Idell Hamilton and Anton Caputo
San Antonio Express-News

CPS Energy expects to announce a settlement today in its $32 billion lawsuit against its partner in a proposed nuclear project, Nuclear Innovation North America.

Utility officials confirmed they are planning to make an announcement this afternoon, barring any last-minute breakdown in negotiations.

A settlement could put the proposed expansion of the South Texas Project back in the forefront for federal loan guarantees that both partners say are crucial to its fate.

The project once was considered a front-runner for the taxpayer-backed guarantees, but its chances diminished in the wake of rising cost estimates, shrinking political support and high-stakes litigation.

On Tuesday, the Obama administration announced the first of the loan guarantees, pledging $8 billion for two new reactors to be built at an existing nuclear power plant in Burke, Ga.

The settlement also could clarify whether CPS plans to stay in the project or withdraw, allowing NINA to find new partners.

CPS acting General Manager Jelynne LeBlanc-Burley declined to comment.

"We’re still finalizing the details," spokeswoman Lisa Lewis said. "But we hope to have more to share tomorrow."

NRG spokesman David Knox wouldn’t comment on the settlement announcement, but earlier in the day issued a statement that the parties were working hard to come to an agreement that could push the project back into contention for the loan guarantees.

NRG owns most of NINA.

In the wake of CPS’ lawsuit, NRG CEO David Crane had said NRG would back out of the project if the loan guarantees didn’t come through.

CPS and NRG, along with Austin Energy, are partners in the two existing nuclear reactors outside Bay City. Austin Energy chose not to take part in the two-reactor expansion, citing cost and risk.

In August, at Mayor Julián Castro’s prodding, CPS agreed to sell about half its stake in the proposed expansion.

Before those efforts began, however, news that the utility’s nuclear development team kept a significantly higher cost estimate from its board exploded into public view, upending a planned vote by the City Council to pump another $400 million into the project.

The expansion had been sold to the council and the public as a $10 billion deal, with another $3 billion in financing costs. The higher estimate kept hidden by executives was as much as $4 billion more.

CPS already has spent about $370 million on engineering and permitting and still is shelling out about $1 million a day to keep from going into default.

In December, it asked a judge to clarify its rights if it were to pull out of the deal, including the fate of the $370 million and half of the site and infrastructure, which CPS says has a value of at least $1 billion.

NRG and NINA argued that if CPS walked away, it would forfeit everything. A state judge disagreed, but sent the parties back to the table to work out the value of CPS’ investment should it choose to bow out of the project.

Negotiations, which recently moved to Austin, where they were mediated by the chairman of the Public Utilities Commission, have centered on how much that ownership is worth, in either a dollar value or a percentage of the project.

Chairman Barry Smitherman said he stepped in to help break the impasse, with the full backing of Gov. Rick Perry, because it was important for the state to get nuclear going again.