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Industry Leaders Brief Wall Street on Expansion of Nuclear Sector

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Industry executives described the prudent steps energy companies are taking as they consider builidng new nuclear plants in the United States in a briefing for Wall Street analysts today. NEI's press release follows:

Nuclear Energy Expansion Will Proceed Cautiously Over Next Decade, Wall Street Analysts Told

NEW YORK, Feb. 21, 2008—Construction of new nuclear power plants in the United States will ramp up slowly over the next decade as project sponsors exercise caution to effectively manage business risks, nuclear energy industry leaders told Wall Street financial analysts here today.

The industry’s expectations are that four to eight new nuclear plants will be generating electricity by 2016 or so, with a second wave of new power plants under construction as the first group commences commercial operation, the Nuclear Energy Institute’s president and chief executive officer, Frank L. (Skip) Bowman said during a briefing attended by more than 75 analysts.

“The exact number will, of course, depend on many factors – forward prices in electricity markets, capital costs of all baseload electric technologies, commodity costs, environmental compliance costs for fossil-fueled generating capacity, natural gas prices and more,” Bowman said. “The confidence gained by success with the first projects will support the decision-making process for follow-on projects.”

Bowman described new nuclear plant construction as “a risk-management exercise” and said that the industry continues the work that has been under way for the past decade to identify and remove or mitigate the business risks associated with these multi-billion-dollar projects.

“We have mobilized experts in licensing and regulation, financing, construction management, political affairs, public support, supply chain and work force. Seventeen entities developing license applications for up to 31 new reactors did not just happen. It has been carefully planned,” Bowman said.

Five license applications for seven potential new reactors were filed with the Nuclear Regulatory Commission in 2007, Bowman noted, and another 11 to 15 applications could be filed this year. Progress Energy just two days ago announced the filing of a license application for two possible reactors at its Shearon Harris Nuclear Plant in North Carolina. Click here for the full NEI release.

Click here for a PDF version of today’s briefing.

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Comments

Anonymous said…
I wonder what four to eight reactors he is talking about? They did not elaborate on that theory. My guess for the top four are Calvert Cliffs, Southern Nuclear, Dominion, and NRG. The follow on four would be Ameren UE, Exelon, Entergy, and TVA.
February 22, 2008 at 1:20 PM
Anonymous said…
Nuclear power plant popular lately but people afraid of it because of the radiation including my country. Your articles are great!
February 22, 2008 at 1:29 PM
Matthew66 said…
My guess is that, if STPNOC can work out its vendor issues, its COL for South Texas Project 3 & 4 may be the quickest to approve as it is referencing a certified design that is not also being revised. Next would probably be the COLs referencing the AP1000 revised DCD, as most of the information can be reviewed concurrently.

The other COLs currently under consideration reference reactor designs that have not been certified, so may take longer. Having said that, however, the North Anna 3 project has an ESP, so there may not be too many site specific issues to look at.

The other point to remember that this briefing took place around the time the Shearon Harris 2 & 3 COL was submitted, so may not have taken that into account. Possible new reactors by 2016:

Watts Bar 2
STP 3 & 4
Bellefonte 3 & 4
William States Lee 1 & 2
Shearon Harris 2 & 3
Calvert Cliffs 3
North Anna 3

That's eleven, if the utilities decide to go ahead. I suspect Admiral Bodman was being cautious in his estimates, although it is probable that some of the COLs will be "banked" rather than acted upon immediately. After all, an issued COL will have serious value in itself.
February 22, 2008 at 2:01 PM
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