Anti-nuclear activists don't want to hear this, but new construction licenses for nuclear power plants are good things.
Granted last month to Atlanta-based Southern Nuclear Operating Co., the first two of what could be 26 or more new licenses moves the national debate over next-generation nuclear power beyond tired rhetoric and places it in the laps of Wall Street investors, where it belongs.
Money talks. By issuing those construction licenses, the U.S. Nuclear Regulatory Commission has forced the industry to prove it has become more attractive to Wall Street's power brokers.
The industry must do that as it addresses lingering consequences -- perceived and real -- from last March's nuclear disaster in Japan. It must court investors without a national repository for spent radioactive fuel, a potential deal-breaker.
On top of that, a new Union of Concerned Scientists report shows American nuclear plants had too many close calls again in 2011, especially for a mature industry. Safety affects investor confidence, regardless of polling by the Nuclear Energy Institute that suggests faith in nuclear power has risen to 81 percent of Americans a year after the Japan accident.
Lunch-bucket views about nuclear power mean nothing if Wall Street doesn't embrace it. Cost overruns, not Three Mile Island, mothballed the nuclear industry. The current batch of construction applications are the first since 1978. Investor confidence waned long before half of Three Mile Island Unit 2's core began to melt in 1979.
Southern Nuclear's two new reactors, planned for the utility's Vogtle complex south of Augusta, are to cost a staggering $14 billion apiece. One would be completed in 2016, the other in 2017. Most of today's plants took longer to build.
In the early days of nuclear power, when bravado flowed and dreams were big, proponents envisioned 1,000 U.S. nuclear plants by the turn of the 21st century, 10 times the current 104 units. They hailed nuclear power as a source of electricity too cheap to meter.
Nearly six decades later, the nuclear industry still has trouble getting a handle on costs. DTE Energy's proposed Fermi 3 nuclear plant in Monroe County, one of only two new plants under consideration in the Midwest and the only one in the Great Lakes region, was a $3 billion project when it was announced in 2007. By 2009, Fermi 3's price-tag had risen to $10 billion.
Five of the 26 applications filed since 2007 have been suspended by their utilities, despite more than $6 billion in government incentives that the George W. Bush administration created under the Energy Policy Act of 2005. DTE has stated that its 2008 application to build Fermi 3 is simply a placeholder. The utility has not committed itself to build anything.
Under the 2005 law, utilities that filed for new construction by Dec. 31, 2008, became eligible for $300 million to $400 million in tax credits. DTE filed a 17,000-page application that cost $30 million to produce.
As recently as 2002, the market for next-generation nuclear power was so tenuous that former U.S. Department of Energy Undersecretary David Garman said many public utility boards kept discussions about plant construction off their agendas to keep company stock prices from taking a hit.
Mr. Bush's energy act helped change that. It extended the mother of all bailouts, the Price-Anderson Act, through 2025 to entice Wall Street. Enacted in 1957 during nuclear power's fledgling era, Price-Anderson lets utilities -- and their investors -- off the hook for all but $12.6 billion of any catastrophe.
Taxpayers assume all other liability, a figure that could potentially reach hundreds of billions of dollars. Former NRC Commissioner Peter Bradford is among those who question why the nuclear industry needs that security blanket.
Horrendous as it was, the Japan accident isn't a good barometer. Japan reprocesses its spent nuclear fuel. The United States doesn't. Had Japan's six damaged Fukushima plants held nearly as much spent fuel as their U.S. counterparts, the crisis would have been many times worse.
The ball is in Wall Street's court. The nuclear industry can deal with rabble-rousers, but not a lack of investors.
The industry faces an uphill battle, but not an impossible one. But if it's any sign of the market for nuclear power, only one of the applications for new construction was submitted after the filing deadline for the Bush tax credits expired.
Tom Henry is an editorial writer and columnist for The Blade.
Contact him at: email@example.com