Bacon's Rebellion

Democracy Thrives in Sunlight

Virginia’s New Nukes

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James A. Bacon
in

The U.S. Nuclear Regulatory Commission has approved an Early Site Permit for Dominion’s North Anna Power Station. Dominion now has 20 years to seek NRC approval for a Combined License to build one or more nuclear plants there before it can start construction. Dominion expects to file the Combined License application by the end of the year. Read more details here.

Good. Nukes make sense for Virginia’s energy policy. If we’re going to shift automobiles from gasoline combustion to electric power, nuclear power may be the most cost-efficient way to go. That doesn’t obviate the need to conserve energy or evolve toward more transportation-efficient human settlement patterns, but it’s an important piece of the puzzle.

Update: After reflecting upon reader comments, I have modified this post slightly, from saying that nukes “are” the most cost-effective way to go to saying that they “may be” the best way to go. The key issue is risk assurance. If state and federal governments absorb the substantial risks associated with nuclear energy — the huge capital costs and long-term payback, the cost of insurance — then nukes aren’t competing on an equal playing field with other energy sources. Nukes need to stand on their own.

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13 responses to “Virginia’s New Nukes”

  1. James Atticus Bowden Avatar
    James Atticus Bowden

    Consider the supply and demand curves. We (the US and Virginia) need more, more, more in the supply of energy.

    Otherwise, as worldwide demand increases with expanding China and India pushing the curves, the supply of energy from petroleum can’t expand enough – fast enough. Price rises any graduate of intro to econ can tell you.

    So, if Virginia increases the supply of energy – from all sources, and mitigates the increase in demand from conservation and going ‘green’ then the price should fall hereabouts.

    The result is discretionary income for every family.

    And,less wealth transfer from Western Civilization to the Middle East, and the inevitable, fungible capital leaking into the hands of Islamists who are fighting us in a long, long world war.

    More energy that doesn’t pollute horribly – is good.

  2. Larry Gross Avatar
    Larry Gross

    How long do these critters last?

    how long does it take to amortize the capital costs?

    If you are a power company, would you believe that in 25 years – that GREEN power would still be “not ready”?

    Get ready for Dominion to try to make a deal that they won’t build unless they are guaranteed that their investment will not become “stranded” in the future.

    If that is the case – then the public policy issue for all of us – is what do we want to invest for the future.

    For myself… if I had no other choices, I’d take Nukes over Coal Powered plants and Nukes for plug-in autos over foreign oil but I’d also want Smart Meters in every house and a significant effort at coal gasification.

    What I’m opposed to is allowing Dominion to do anything more in the way of building potentially stranded facilities without substantial changes in the way that Virginia deals with conservation.

    We need to step back from what is best for Dominion and it’s investors and to re-orient to what is best for Virginia and it’s citizens.

  3. Jim Bacon Avatar
    Jim Bacon

    Larry, I agree, we need to take the same approach to nukes that we do to roads and highways. They should compete on a level playing field with the alternatives, including conservation and renewables. I’ve read in passing that nuclear power enjoys the benefit of some kind of federal guarantees — loan guarantees, maybe? The advocates of renewables can rightly say, hey, if you’re guaranteeing the loans for nukes, why not guarantee the loans for renewables?

    I’d prefer to reverse the logic. No loan guarantees for anybody. Our investment in any type of electric-generating capacity should reflect the risks associated with that investment.

    You raise an interesting issue about the long life of nukes and Dominion’s likely desire to be guaranteed that its investment won’t some day be stranded. If Dominion adopts that logic, I wouldn’t buy it. If Dominion is worried that nukes might one day be uneconomical, maybe it should invest in something else.

    Government does not help society make prudent investments by taking the risks out of those investments. If we’ve learned one thing from the sub-prime lending fiasco, risks are real. Governments can’t make those risks go away.

  4. Anonymous Avatar
    Anonymous

    I’ll support Nukes when they can buy their own insurance.

  5. Larry Gross Avatar
    Larry Gross

    Insurance?

    what about all the taxpayers money that will be required to “harden” them against those nasty terrorists?

  6. Groveton Avatar
    Groveton

    “No loan guarantees for anybody.”

    Doesn’t Virginia’s guarantee of a rate of return for Dominion constitute a kind of loan guarantee for anything they build? If they build something ineffective they still get a guaranteed rate of return. No?

  7. Anonymous Avatar
    Anonymous

    Coal power plants get “subsidies” in terms of the amunt of pollution they are allowed to release. It’s a pretty sure bet you will get a low level of damage.

    Nukes are indemnified against loss due to nuclear accident by the government. It’s a word game anyway, because if there is a serious accident, no one is going to collect. It’s a small probability of a LOT of damage.

    Renewable sources have problems we haven’t identified yet.

    Freezing in the dark has problems of its own, too.

    You pay your money, you take your choice.

  8. Larry Gross Avatar
    Larry Gross

    “If they build something ineffective they still get a guaranteed rate of return.”

    yes. and .. worse.. the more of it they sell.. the more money they make… guaranteed.

    Conservation, in fact, hurts their bottom line.

    That’s why we should not approve new plants – coal or nukes until we make changes that encourage and incentivize more efficient energy use.

  9. Larry Gross Avatar
    Larry Gross

    In reading the NYT today, it became clear what a major problem there is with wind/solar and that is that wind/solar are not always “working” when there is demand.. and that aspect by itself is not the issue.

    The issue is.. what power source do we have when wind/solar are “not” producing – and further… what good is wind/solar when the grid is already fully powered.

    And what this goes to – is the fact that the base load – coal and nukes cannot be modulated quickly.

    You cannot “turn down” a nuke or coal power.. 5 minutes after a surge of wind and/or solar becomes available.

    Further, if you’re powering part of the grid with wind/solar and the wind dies or clouds reduce solar, you cannot raise the power on coal or nukes.. quickly.

    What power providers do is figure out what their base power load needs to be – and then they “top” it off with natural gas “dispatch” plants which can be turned “on” or “off” quickly.

    How would wind/solar fit into this paradigm since neither can effectively function as neither base nor dispatch loads?

    thoughts?

  10. Anonymous Avatar
    Anonymous

    What about waste from commercial nuclear plants? Has that issue been forgotten? You can only recycle so much.

  11. Jim Bacon Avatar
    Jim Bacon

    Larry, you have identified the biggest problem with wind and solar from an electric system point of view. There does appear to be a solution, although it adds another layer of expense, and that is to store the electric power in batteries (or perhaps some other way not yet developed). That can work at the household level, though probably not at the level of giant wind farms.

    That’s why there’s a one percent limit on the amount of electricity on Virginia’s grid that can come from small-scale, independent production of wind and solar. If we want renewable fuels to be more than a marginal contributor, it’s the fundamental issue we have to address.

  12. Anonymous Avatar
    Anonymous

    “You cannot “turn down” a nuke or coal power.. 5 minutes after a surge of wind and/or solar becomes available.

    Further, if you’re powering part of the grid with wind/solar and the wind dies or clouds reduce solar, you cannot raise the power on coal or nukes.. quickly.”

    Right. There are batteries, and pumped hydroelectric systems, you could store energy in molten sulphur (captured from coal plants), compressed air, flywheels, or you could use the energy to split water and recombine it later. You can “store” renewable energy by having enormous long didtance grids to transmit it from where it is available to where it is needed.

    All of those processes cost money, and they all involve pollution of their own.

    Rather than railing against coal or nukes or power line grids, what we should be doing is asking the right questions: the ones that lead to the most economical answers.

    Whether we like the environmental consequences or not: environmental consequences have costs that need to be figured in.

    But we cannot do that if we think for an instant that some environmental costs are infinite.

    RH

  13. Anonymous Avatar
    Anonymous

    “If they build something ineffective they still get a guaranteed rate of return.”

    yes. and .. worse.. the more of it they sell.. the more money they make… guaranteed.”

    This isn’t correct. Dominion gets a guaranteed minimum rate of return on their capital investment. After that, they are like any other business, the more they sell, the more they make, unless their costs of selling are extraordinarily high.

    “Conservation, in fact, hurts their bottom line.”

    This is true of ANY business.

    “That’s why we should not approve new plants – coal or nukes until we make changes that encourage and incentivize more efficient energy use.”

    I take back my previous statement: It is true of ANY business except for those “incentivized” (subsidized) to promote more “efficient” energy use.

    How warped is that? If it was actually more efficient, why would they need to be subsidized?

    Why not just have Dominion raise the rates? We can subsidize tehm just as easily as the next guy, and the higher rates would encourage people to use energy more efficiently.

    Of course Dominion would make more profits, and we all hate profits, don’t we? Why should we have to pay more just to get what we want (more conservation)?

    For a guy that hates subsidies, you sure are selective about the ones you promote.

    RH

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