President Bush on Nuclear Energy's Revival

Making the rounds in his farewell tour, President Bush stopped by the American Enterprise Institute yesterday afternoon and was asked about the progress of the nuclear renaissance during his administration.

Mr. DeMuth: Let me ask you two questions, if I may, about energy policy. The first is, are you satisfied with the progress in recent years in reviving nuclear energy? The second is about ethanol. The question says, "Ethanol subsidies are popular with politicians of both parties, but not with ordinary folk outside the state of Iowa." (Laughter.) Does this have something to do with the timing of the first presidential primary?

The President: Sounds like some of my friends in Texas asking that question. (Laughter.)

Mr. DeMuth: You can talk about nuclear power.

The President: Yes. (Laughter.) The country needs to overcome its fear about nuclear power if we want to have ample electricity so we can grow and be good stewards of the environment.

Part of the problem with nuclear power was that the regulatory scheme was such that people would risk a lot of capital and then have to seek permission for final approval late in the process, and would find themselves tied up in a court of law. And so they had enormous capital spent, earning no money, waiting for permission to build the plant. And therefore, capital chose not to go into the nuclear industry.

In terms of safety, the engineering has changed dramatically from the past, and I think people who are objective on this issue would tell you that nuclear power plants are very safe.

In terms of regulatory relief, as a result of the last energy bill I signed -- I think it's the last energy bill -- we began to streamline the process, and as well was we provided some insurance incentives for people to start building. I'm satisfied that we're beginning to change the environment. I'm satisfied that more Americans understand why we ought to be using nuclear power. I am pleased that there are I think, like, 13 permits that have been on application. And I am pleased that some plants are beginning to expand on their current footprint.

I am not pleased about how slow we're moving overall, though. I think we ought to really get after nuclear power, I mean, if we really want to solve our dependency upon foreign energy.

What's going to happen is, by the way, the technologies will help change our habits. For example, there's going to be battery technologies in automobiles that will enable people to drive the first 40 miles on electricity. And everybody is going to -- oh, that's great, hybrid plug-in batteries. The question will be, where do we get the electricity? And it's very important to pursue nuclear energy.

Secondly, I'm a big supporter -- I presume I'm one of those guys you were talking about on pandering to the corn -- actually, I think it's important -- I felt it was important to begin a diversification of our energy sources. And whether or not the ethanol market will stay viable, I don't know, but it has certainly become a relatively significant part of our mix right now. And I laid out a mandatory goal that we ought to head toward because I'd rather have our farmers growing our energy than rely upon certain parts of the world that don't like us.

It's a fascinating interview. The full text is here, though I highly recommend watching the video here, compliments of C-SPAN.

Fluor Invests in NuScale

You know, it’s kind of sad that no one is willing to invest in nuclear energy anymore. Wait, what? NuScale Power celebrated the news of its company-saving $30 million investment from Fluor Corp. Thursday morning with a press conference in Washington, D.C. Fluor is a design, engineering and construction company involved with some 20 plants in the 70s and 80s, but it has not held interest in a nuclear energy company until now. Fluor, which has deep roots in the nuclear industry, is betting big on small-scale nuclear energy with its NuScale investment. "It's become a serious contender in the last decade or so," John Hopkins, [Fluor’s group president in charge of new ventures], said. And that brings us to NuScale, which had run into some dark days – maybe not as dark as, say, Solyndra, but dire enough : Earlier this year, the Securities Exchange Commission filed an action against NuScale's lead investor, The Michael Kenwood Group. The firm "misap...

Wednesday Update

From NEI’s Japan micro-site: NRC, Industry Concur on Many Post-Fukushima Actions Industry/Regulatory/Political Issues • There is a “great deal of alignment” between the U.S. Nuclear Regulatory Commission and the industry on initial steps to take at America’s nuclear energy facilities in response to the nuclear accident in Japan, Charles Pardee, the chief operating officer of Exelon Generation Co., said at an agency briefing today. The briefing gave stakeholders an opportunity to discuss staff recommendations for near-term actions the agency may take at U.S. facilities. PowerPoint slides from the meeting are on the NRC website. • The International Atomic Energy Agency board has approved a plan that calls for inspectors to evaluate reactor safety at nuclear energy facilities every three years. Governments may opt out of having their country’s facilities inspected. Also approved were plans to maintain a rapid response team of experts ready to assist facility operators recoverin...

Nuclear Utility Moves Up in Credit Ratings, Bank is "Comfortable with Nuclear Strategy"

Some positive signs that nuclear utilities can continue to receive positive ratings even while they finance new nuclear plants for the first time in decades: Wells Fargo upgrades SCANA to Outperform from Market Perform Wells analyst says, "YTD, SCG shares have underperformed the Regulated Electrics (total return +2% vs. +9%). Shares trade at 11.3X our 10E EPS, a modest discount to the peer group median of 11.8X. We view the valuation as attractive given a comparatively constructive regulatory environment and potential for above-average long-term EPS growth prospects ... Comfortable with Nuclear Strategy. SCG plans to participate in the development of two regulated nuclear units at a cost of $6.3B, raising legitimate concerns regarding financing and construction. We have carefully considered the risks and are comfortable with SCG’s strategy based on a highly constructive political & regulatory environment, manageable financing needs stretched out over 10 years, strong partners...

NEI Nuclear Notes

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