North Anna 3: $500 Million Before Construction Even Begins

James A. Bacon

17 years ago

Sen. Ken Cuccinelli, R-Fairfax, has maintained an interest in nuclear energy since his days as an undergraduate engineering student at the University of Virginia when he took a course in nuclear engineering. Now the Northern Virginia intellectual property attorney, who sees potential to build a formidable nuclear industry cluster in Virginia, is reimmersing himself in the subject.

Most recently, Cuccinelli has focused on Dominion’s proposal to build a third nuclear reactor at its North Anna complex using a commercially untested technology developed by General Electric and Hitachi. In correspondence with Dominion, Cuccinelli has surfaced details of the project that are either new or under-reported:

Ownership. Assuming Dominion makes the decision to pursue the project, it will own 88.4 percent of the facility, with the Old Dominion Electric Cooperative owning 11.6 percent.

Up-front costs. The project will incur $500 million in preliminary engineering, design and regulatory costs before construction even begins. The Department of Energy will pay 50 percent, Dominion will pay $60 million net, while GE-Hitachi Nuclear Energy and its subcontractors will fund the balance.

Those costs, according to Dominion spokesman Bill Byrd, include:

Preparation of the Combined Operating License application, and the U.S. Nuclear Regulatory Commission’s fees for review of the application.

Submittal of GE’s application for design certification of its Economic Simplified Boiling Water Reactor (ESBWR) design, and the review fees for that application. The reactor design must be approved for Dominion’s project to be licensed.
Detailed engineering of the ESBWR design that will be used to produce the construction drawings needed to build the plant.
Detailed engineering for specific features of the North Anna site, such as cooling tower design.
Economic and financial risk analyses to determine the feasibility of construction.

Bacon’s bottom line: There are significant costs associated with being the first guy to try out a new technology like GE-Hitachi’s design for cheaper, safer nuclear power generation. Luckily for Virginia electric rate payers, the DOE and the developers of that technology are paying for nearly 90 percent of the cost of working through a lot of those issues. … On the other hand, I can see why proponents of renewable fuels call for tax breaks and subsidies. Nuclear power, they say, is heavily subsidized, too, so there’s no level playing field.

(Heads up: If you’re interested in the future of nuclear energy in Virginia, don’t miss the upcoming column by Peter Galuszka in the Bacon’s Rebellion e-zine.)