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Where Goes Solar, There Goes Nuclear?

wanoThis MIT Technology Review article is good but gets off on the wrong foot:

Politicians are drawing parallels between the $535 million federal loan guarantee issued to bankrupt solar manufacturer Solyndra and loan guarantees that the U.S. Department of Energy is offering to utilities building new nuclear power plants. But while those nuclear startups could also go bust, experts say U.S. taxpayers are unlikely to take a loss on them. That's because the only reactor projects moving forward are those in a handful of southern states, where laws allow utilities to offload the risk onto state ratepayers.

Offload the risk? All the risk of any large electricity project redounds to the ratepayers – because they pay the bills. What those southern companies are doing is using a method that pays for plant construction as it goes along – which means less money borrowed from banks or paid back to banks – and thus less interest charges for ratepayers to eventually absorb.

Here’s how Southern Co. explains this in relation to the Plant Vogtle project:

  • The cost of the plant will be phased-in over 7 years, versus included in rates over only two years. (Approx. 1.3 percent/yr over 7 years for total of 9 percent, versus approximately 12 percent total over two years.)
  • Customers will avoid paying $300 million in interest charges, thereby saving money over the life of the plant.
  • The in-service cost of the plant will be reduced by nearly $2 billion (30 percent).
  • Total rate increases required to cover the cost of the plant when it goes into service will be nearly 3 percent lower.
  • Preserving utility credit ratings reduces costs for other projects and helps keep customer rates low.

The MIT story is interesting in that it explains how this use of pay-as-you-go differs in regulated and non-regulated states and what the implications of that might be for nuclear energy projects.

It still comes back around to loan guarantees:

While the Solyndra case appears unlikely to be replicated with nuclear loan guarantees, political attacks from Congressional Republicans on the wisdom of loan guarantees for energy projects may, ironically, hurt the prospects for further nuclear projects that many support.

We’ll just have to wait and see, but those Congressional Republicans are as aware of nuclear energy loan guarantees as we are. It doesn’t necessarily follow that where goes solar also goes nuclear.

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If you’re going to open a new nuclear facility, it makes sense to stress safety.

Hsu said Taipower had incorporated improvements to the project, such as an emergency diesel generator facility, after the Fukushima Daiichi Nuclear Power Plant crisis in Japan, triggered by a massive earthquake and tsunami that crippled the facility on March 11.

This is in Taiwan. Hsu is Taipower vice president Hsu Hwai-chiung. There’s more on safety:

In line with Ma’s instructions, Hsu said, Taipower would adopt the strictest possible safety standards in handling the Fourth Nuclear Power Plant’s testing and supervisory work.

“We will invite international professional organizations, such as the World Association of Nuclear Operators, to assist with oversight and the plant will go online only once optimal safety is guaranteed,” Hsu said.

In addition to Taipower’s internal controls, the Ministry of Economic Affairs and the Atomic Energy Council (AEC) have also closely monitored the construction of the plant to ensure safety standards are met, Minster of Economic Affairs Shih Yen-shiang said.

And Ma is Taiwan President Ma Ying-jeou. The World Association of Nuclear Operators, or WANO, is really stepping up to the plate here. These are the recommendations approved by WANO’s board during its general meeting in October:

These included expanding the scope of WANO's activities; developing a world-wide integrated event response strategy; improving WANO's credibility, including important changes to WANO's peer review process; improving visibility; and improving the quality of all WANO products and services.

This sounded as though WANO was interested in adopting the approach taken by the Institute of Nuclear Power Operations, the nuclear energy industry-created watchdog, into the international sphere. And indeed, that’s at least partly the case:

WANO said that it will also put into place an internal emergency response procedure that clearly defines roles and responsibilities in the event of a nuclear emergency. It will also take additional initiatives of working with other key industry organizations such as the International Atomic Energy Agency, the World Nuclear Association and the Institute of Nuclear Power Operations.

Issues of national sovereignty can easily keep WANO from becoming as effective as it could be, but if the organization’s members allow it latitude, as Taiwan is doing, and WANO is able to gather enough authority around itself, then its potential expands accordingly. It’ll be interested to see how the experience in Taiwan goes.

Sort of an interesting merger of the WANO logo – which is a wireframe world map – and a map showing its main offices.

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