Now, there were also representatives from the coal, natural gas, wind and hydro industries present at the hearing yesterday (solar was included earlier), so do not let our monotonic focus confuse you into thinking nuclear was overstressed at the hearing at the expense of others. Not at all.
Finally, this story is taken from Nuclear Energy Overview, our news service for NEI members. What you may not know that NEI’s member will know is that 1. John Rowe is a very prominent figure in the industry, so his words carry considerable weight with the Senators. He speaks to the interests of the industry and, as you’ll see, he’s very frank and realistic in his assessments. 2. Rowe was chairman of NEI (and other industry associations, too, over his long career) for a spell. Members know that, but for our purposes, so should you. (And he said so in his testimony – no need for it to be repeated in the story.)
So, without further ado:
Exelon CEO John Rowe brought nuclear energy front and center Thursday in the marathon three-day hearings being held by the Senate Environment and Public Works committee. Rowe offered his perspective on the potential role of nuclear energy in the Kerry-Boxer climate change bill (S.1733) and provided his viewpoint on elements in the bill that would help the expansion of nuclear energy.
Asked by Sen. Amy Klobuchar (D-Minn.) what incentives should be in the bill “to get 150 new nuclear plants up and running in the coming decades,” Rowe provided a list of elements.
“First,” Rowe said, “supporting at least uprates, or better yet … new nuclear plants as part of a low-carbon energy package would have a positive impact. A legislative finding that on-site storage or surface storage of spent nuclear fuel is an acceptable long-term solution to the used nuclear fuel issue would be an important step. Obviously, increasing amounts of loan guarantees would be valuable.”
But Rowe wanted to ensure that as a “believer in the free market,” the best solutions would be chosen over time as according to the circumstances. “We have to look at some long-term things—like solar or like next-generation nuclear plants as things we want to get jump-started, but we don’t want to go too far.”
He continued, “As many people here have suggested, what we’re ultimately looking for is to include the cost of climate protection into the marketplace then let the market make choices from decade to decade that none of us are wise enough to make today.”
Rowe provided an assessment of how many nuclear plants will be built in the short and mid-term. “I believe that the six or eight units that are supported by the existing federal loan guarantee program will ... be in operation by 2020. I do not think there will be a significantly larger number than that. If those units are successful, I believe there will be more on line by 2030 but I doubt it will be many tens let alone one hundred.”
Rowe agreed with Sen. George Voinovich (R-Ohio) that the continued low price of natural gas “haunts” hopes for new nuclear plants. “The low-cost solution for the next decade is often natural gas, and that takes pressure off to work on either new nuclear or the more advanced forms of renewable energy.”
Rowe also strongly agreed with Sen. Lamar Alexander (R-Tenn.) that nuclear energy should be considered equivalent to renewable energy sources in terms of the renewable standard. “A carbon-free goal or set of subsidies would be preferable to renewable-only subsidies,” he affirmed to Alexander.
Other panelists included Preston Chiaro, CEO of Rio Tinto; Willett Kempton, professor of marine policy at the University of Delaware; Bob Winger, president of the International Brotherhood of Boilermakers, Local 11; Fred Krupp, president of the Environmental Defense Fund; Mike Carey, president of the Ohio Coal Association; and Bob Stallman, president of the American Farm Bureau Federation.
John Rowe.
Comments
"...150 new nuclear plants up and running in the coming decades...” 15 every 10 years? I do not believe it. However, all is not lost. Mr. Rowe replied with reason in the following statements: "We have to look at some long-term things—like solar...," "Rowe agreed with Sen. George Voinovich (R-Ohio) that the continued low price of natural gas “haunts” hopes for new nuclear plants. “The low-cost solution for the next decade is often natural gas, and that takes pressure off to work on either new nuclear or the more advanced forms of renewable energy.”
Then, more propaganda- "Rowe also strongly agreed with Sen. Lamar Alexander (R-Tenn.) that nuclear energy should be considered equivalent to renewable energy sources in terms of the renewable standard."
Well jeez, I strongly agree that my zinc and copper plated penny should turn to gold, alchemy ain't gonna make it happen, nor will political alchemy make nuclear energy a renewable energy source.
I don't see how any of your first three paragraphs has anything do do with nuclear as being renewable. Basic physics does support nuclear being renewable through breeding. Current economics heavily based on natrual gas prices and the low price of uranium does not support this, but that's another issue.
Change my math, 50 every 10 years.
Moderator, please feel free to edit my previous post.
"Propaganda"? It's the Greens and pseudo-Greens who tout the propaganda while their intermittent, weather-dependent, low-efficiency boutique power sources give the impression of concern for the environment.
In certain limited locations and applications, they're fine, but not for base-load of an industrial, high-tech society (nor those which aspire to be).
The limitations on nuclear build-rate are political, not technological.
Rowe earned his formal education in law and started his career as an attorney working for Isham, Lincoln and Beale where he became a partner.
He has worked his way up the corporate ladder and been involved in a number of utility company mergers that have resulted in the assembly of one of the largest utilities in the US.
Exelon, the company he leads, owns 19 nuclear reactors; 17 of which are in operation. Two of them sit idle by the shores of Lake Michigan. They were shutdown in the late 1990s due to a number of factors including labor troubles, steam generators that needed to be replaced, and low natural gas prices.
Exelon sells electricity in competitive wholesale markets where the price is set by the "last in" generation required to serve the load. Rapid increases in supply would reduce the sales price of electricity in competitive markets that do not have guaranteed cost recovery.
Selling electricity from established, nearly fully depreciated nuclear power plants in a competitive market has been a HIGH margin business for the past 8-10 years. The margins drop when gas prices are low.
The rapid build up of nuclear plants along with their increasing production of reliable electricity during the period between 1970 and 1990 resulted in a large shift in the market share numbers. Nuclear captured 20% of the generation market in just 25 years, causing a reduction in sales by oil, gas and coal.
That loss of demand caused coal, oil and gas prices to fall and contributed to 15 years worth of low fossil fuel prices due to a change in the balance between supply and demand.
John Rowe is a smart man who has a well known hobby of studying history. He has said on a number of occasions that he makes decisions, however, based on the near term effects. I think he said something once about being grateful that he runs a company where a predecessor went through the struggle of building nuclear power plants - but then said he had no intention of struggling like that since that predecessor had died before enjoying the fruits of the struggle.
Here is a summary of ComEd's situation in the early 1990s, not long before Rowe took advantage of the company's struggles and applied strong corporate discipline to the task of recovering health for the stockholders:
"Many observers felt that ComEd should have canceled or postponed some of its plants in the early 1980s, due to underestimated construction costs and overestimated demand.
As a result of overbuilding in its nuclear program, ComEd's generating capacity exceeded average peak demand by 33 percent in 1990 (most utilities maintain a 15 percent surplus). Thus, while many major utilities around the nation were found to be spending $15 to $51 on conservation per customer, ComEd was spending 39¢ per customer, according to a study by a committee of the Chicago City Council."
I admire Rowe and his accomplishments; I just do not think that his perspective is one that should rule the day. I am a guy who lives well on less than 1/10th of Rowe's salary (not including any fringes or bonuses). I know it is impolite in American to bring up class struggles, but Rowe lives in a completely different class than I do and has for a very long time.
I am no archeologist, but I am pretty sure that most of what I have read about the ruins found of ancient humans have included at least some remnants of solar energy collection systems to perform such tasks as drying hides, isolating salt, and drying fuel to be used when the sun is no longer shining. They also designed their dwellings to take maximum advantage of the sun's predictable travel across the sky.