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Nuclear Standoff - Hope for Change

Fortnightly Magazine - December 2009

not our first choice [but] it’s probable that nuclear will have to be part of the solution. We believe the Senate will make the right trade-offs and come ready to pass a real hard cap and the means to get there.”

Whether such trade-offs will get legislation across the finish line during the 2009 Congressional term, however, seems unlikely at this writing in mid-November. Major legislation like climate policy faces long odds next year, with many members of Congress turning their attention to the 2010 mid-term elections. That could spell trouble for nuclear incentives.

“There might be a miscalculation in tying nuclear so closely to the climate debate,” says Jack Spencer, a research fellow at The Heritage Foundation. “It should be tied to the environmental debate generally, because nuclear is so environmentally friendly. But if climate legislation doesn’t go forward next year, then you’ve tied your future to a wagon that might go nowhere.”

Blue Ribbon Bluff

Nuclear industry advocates are seeking a series of policy changes to help launch the nuclear renaissance. In late October, NEI sent to federal lawmakers a wish list that includes, among other things: new plant financing—primarily through a proposed quasi-bank called the Clean Energy Deployment Administration; tax incentives for nuclear equipment manufacturing and hiring; steps to further streamline the new-plant licensing process; financial incentives for developing “voluntary” interim spent-fuel storage facilities; and reforms to nuclear fuel supply markets, particularly involving government-generated inventories.

“Our immediate concerns are with the loan-guarantee program, making sure that’s effectively implemented to get the first couple of projects off the ground,” Kass says. However, NEI intends the package of proposals to lay the groundwork for a sustainable nuclear renaissance. “Our development cycle is long,” she says. “It spans the traditional election cycle, even for a senator. This long-term view is difficult when we’re subjected to every election, [with governments] coming and going.”

Spent-fuel management represents perhaps the most notorious example. The Obama administration took the Yucca Mountain repository project “off the table” early in 2009, and DOE deleted its funding in the agency’s 2010 budget request. Killing Yucca Mountain closed off the industry’s exit strategy from its current, temporary approach— i.e., storing spent fuel onsite in dry casks. This is a problem because while dry casks keep the current nuclear fleet generating power, they can raise local political conflicts for such facilities as Xcel Energy’s Prairie Island plant—where residents fought to prevent Xcel from doubling the number of casks at the site to accommodate a 164-MW uprate. Without a long-term strategy for dealing with spent fuel, the industry might find any new-plant renaissance difficult to sustain (s ee “ Nuclear Breach ).

To formulate a more rational strategy, DOE Secretary Steven Chu announced earlier this year that he would assemble a blue-ribbon commission of nuclear policy experts, and that the commission would consider the full range of options for dealing with spent fuel. “Having that group take a fresh look at the issue and having stars in the administration behind it will be helpful for everyone,” Kass says.

Exactly when