If anyone tells you they know what building a new nuclear power plant is going to cost, be skeptical.
No one has built a commercial nuclear power plant in decades in the U.S. During the 1970s and 1980s, cost overruns derailed more than 100 reactors. (Ever-increasing regulatory burdens and sky-high interest rates drove up costs, too.) In part because no reactor has built here in so long, no bank or group of banks wants to take on the risk of lending more for a new plant. That’s why the Southern Co., which plans to build two new reactors in Georgia, needs the $8.3 billion in U.S. government loan guarantees announced last week by President Obama. While all the other worries swirling around nuclear power—what to do with the waste, fear of proliferation, the threat of terrorism, safety and the rest—play some role, the most important thing standing in the way of a so-called nuclear renaissance in the U.S. is that building big new plants costs too darn much money.
And yet, if we want to stop burning coal, the dirtiest fossil fuel, to generate baseload electricity, we need to explore the nuclear option. That means finding ways to bring down the costs.
One option? Build smaller nukes.
Hyperion's 12-ft tall underground reactor, compared to a 170-foot high above-ground conventional plant
Small nukes–sometimes called backyard nukes, because some of them could literally be buried in a suburban yard–were the topic of an excellent front-page story last week in The Wall Street Journal (Small Reactors Generate Big Hopes, subscription req.) and a panel discussion the following day at the Platt’s nuclear energy conference in Bethesda, Md. Small nukes are a hot topic right now because three utility companies–Tennessee Valley Authority, First Energy Corp. and Oglethorpe Power Corp.–have agreed to work with Babcock & Wilcox, a longtime industry supplier, to get a small reactor design approved by the U.S. Nuclear Regulatory Commission.
The Babcock & Wilcox reactor, called mPower, would generate 125 to 140 megawatts of power, about a tenth as much as the big plants being proposed by the Southern Co. and others. Other modular nukes are even smaller: NuScale Power, a venture-funded startup, wants to build a reactor that’s 65 feet long and 15 feet in diameter, capable of generating 45 MW of power. Another startup, called Hyperion Power, is touting a 25MW reactor, which would be compact enough (5 feet across by 12 feet high) to fit in a pickup truck, yet powerful enough to supply about 20,000 homes.
What’s driving interest in small nukes? “The desire to break up the very large upfront capital costs” of conventional nukes, said Daniel Ingersoll, a nuclear engineer at the Oak Ridge National Laboratory, at the Platt’s event. Like wind turbines or solar panels, small nukes can be ordered sequentially by a utility company–reducing risk, and allowing profits from the first reactors to pay for those that follow.
“I think we’re on the verge of seeing a paradigm shift in power generation,” Ingersoll said.
Perhaps, but it will be a slow one. The NRC will take years to approve the design of a small nuke, and whichever company builds first will then need years to deploy. Of course, everything in the nuclear industry moves slowly.
Babcock & Wilcox, which is based in Lynchburg, Va., appears to be farthest along because it has interested customers, a big power-generation business and a history of supplying nuclear products and services to the government. Even so, according to Michael Shepherd, vice business – business development, B&W’s first small nuke could be a decade away. “We see construction in 2016,” Shepherd said. “We can see going online in 2019, 2020.”
As startups, NuScale and Hyperion can move quickly but it’s not clear whether they have the financial wherewithal, customer relationships or experience with the NRC to succeed. Both are using government-funded designs–Nuscale, which is based in Corvallis, Oregon, is using a design licensed from the Idaho National Laboratory and Oregon State, while Hyperion, which is based in Santa Fe, New Mexico, licensed its design from the Los Alamos National Laboratory, where the atom bomb was invented.
Paul Lorenzini, the founder and CEO of NuScale–he’s a lawyer as well as a nuclear engineer–said his company’s design relies upon proven technology and will sit in an underground pool of water. “We get simplicity,” he said. “And out of the simplicity, we get safety and we get economics.”
Deborah Deal Blackwell, senior vice president at Hyperion, said small nukes could be used to deliver power to remote communities that are off the grids or to poor countries that desperately need electricity for schools, hospitals, transportation and water treatment. The Hyperion nuke would be loaded with enough fuel to last 7 to 10 years, then returned to the factory for refueling.
No company has put a price tag on its product, but there’s talk that they could be built for $4,000 to $5,000 per kilowatt of capacity.
It’s exciting to see the entrepreneurial energy behind backyard nukes, although whether any of them will, or should, get built remains an open question. We’ll hear more during a panel dubbed “Nuclear 2.0″ at Brainstorm Green, FORTUNE’s conference on business and the environment, which will be held April 12-14 in Laguna Beach, CA. I’m pleased that Paul Lorenzini of NuScale and John “Grizz” Deal, the CEO of Hyperion, have agreed to speak, and I’m recruiting a speaker from Babcock & Wilcox as well. We’ll have supporters of big nukes, like NRG Energy’s David Crane, at the event, and some of America’s most important environmental leaders will be there as well, so the discussion is bound to be lively.
Sure, and if anyone tells you nuclear is going to be safe, be sceptical too!
Fair point, Tom. These are all unproven ideas.
But let’s consider the safety comparison between nuclear and coal–I’m no safety expert but my vote goes to nuclear.
Tbh Mark,
They both emit massive amounts of CO2 and radiation (just at different stages in the process).
Coal does further emit arsenic, mercury, selenium and other not so pleasant toxins, to be sure but then I am from Ireland and I well remember when the Irish Sea was the most radioactive sea in the world as a result of emissions from the UK’s Sellafield Nuclear Power plant.
I don’t think you should be framing it as a choice between coal and nuclear – both are poor choices.
Tom, You seem to be bubbling with anti-nuclear propaganda. First numerous peer reviewed life-cycke studies of nuclear power have concluded that nuclear emits no more CO2 than wind and less than solar PV. The problems at Sellafield were problems with British technology, that no one plans to use in the United States, or for that matter in the UK, The United States EIA reports that the levelized cost of nuclear power plants to be completed in 2016 will actually be lower than the levelized cost of wind facilities with equivalent output. Nuclear is not only a better choice than coal, it is a better choice than wind!
@Tom – even if the Irish sea was “the most radioactive sea in the world” you could still safely swim there and eat the fish that lived there. The same could not necessarily be said about the lakes and streams downstream of coal fired power plants.
The projected time lines for small nuclear plants could be accelerated with some amount of effort. There was a time when the US government funded a small reactor project aimed at designed, manufacturing and installing a heat and power generation machine under the ice at Camp Century, Greenland. http://www.thuleforum.com/alconotebook.htm
From the time that it was funded until the time that it was operating in that remote location and keeping people alive in a very harsh climate was just 18 months. Back then, engineers worked on paper and used slide rules.
Do we really believe that technology would not allow at least equal performance today? We need to change the stupid, human imposed rules that ensure continued prosperity for the coal, oil and gas companies and move forward with energy innovation that offers as much room for improvement as the transistor did in electronics and microprocessor compared to vacuum tubes.
And yet again Charles you demonstrate your tendency to insult those with whom you disagree. And this time, not content to insult me (again), you decide to take on British Technology in its entirety. There was lots of British technology in Three Mile Island, was there? Or in Vermont Yankee nuclear reactor which is currently leaking tritium like a sieve – a sieve with some very large holes in it?
Unfortunately Rod, the cancer clusters in Dundalk and the surrounds would disagree with you.
And as you mention lakes and streams downstream of coal-fired power plants – no argument with you there, however, the lakes and streams downstream of uranium mines are often incredibly radioactive – 5400 x normal levels in this Australian example http://www.minesandcommunities.org//article.php?a=9914
Both coal and nuclear are dirty and dangerous and have no place in our safe energy future.
The costs of new nukes are already higher than wind, and solar is falling while nuclear is rising. Ask the Finns whose reactor being built by nuclear “expert” AREVA is already at huge cost overrun and 2 years behind schedule. We can get where we need to be without any more nuclear. And no one wants to discuss the connection between nuclear power and nuclear bombs. . .yet the commercial nuclear power industry worldwide has managed to create 220 metric tons of weapons usable plutonium, which is really the ultimate worlds terrorist threat.