Back to the Old Nuclear Arguments

Back to the Old Nuclear Arguments–in a Good Way

The argument advanced by Sen. Lisa Murkowski (R-Alaska) – that taking down baseload energy plants has the capacity to destabilize the grid – a couple posts down should not lead anyone to imagine that the tired old arguments are anywhere near dead – or old or tired, for that matter.

Lyons says a major problem is that the market presently has no mechanism to sensibly recognize the value of carbon-free power generation, particularly nuclear power. “When well-run, clean [nuclear] energy sources are forced out of the marketplace due to a combination of reduced demand, low natural gas prices and market structure,” Lyons was quoted as saying by the Greenwire energy-news service, “our markets are providing the wrong signals.”

Lyons here is Peter Lyons, the Department of Energy’s assistant secretary for nuclear energy. He was also an NRC commissioner in his time. So he may be an interested party but also an extremely knowledgeable one.

Lyons said that the DOE studied a scenario where 30 percent of the county’s 100 reactors would be shut down. He said the DOE regards many of the nuclear plant closures currently on the calendar as premature. If those closures were to go ahead as per that scenario, there would be no way to meet our goal of cutting emissions 17 percent below 2005 levels by 2020.

Lyons also says that there is “no mechanism to sensibly recognize the value of carbon-free power generation…” which may sound like a return to trying for cap-and-trade or a carbon tax.

Forbes writer Michael Krancer gives Lyons a lot of space – he spoke at a Platts conference not long ago – and as always, Lyons is on point. The whole piece is well worth a read. Whereas Murkowski broadens the conversation by warning that overregulating baseload energy – she’s including coal and natural gas in her figuring – Lyons brings back the issue of climate change and carbon emissions. Which is still valid and worth having in the mix. When you take in all the plausible policy goals one might develop with energy these day, nuclear energy, at least as a key element in a diverse portfolio, comes out ahead- way ahead.

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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