by James A. Bacon
With little fanfare two weeks ago, Dominion Virginia Power announced its intention to extend the life of its two nuclear units at the Surry Power Station for another 20 years. Commencing service in 1972 and 1973 respectively, the units are licensed to continue operating through 2032 and 2033.
“Over the next several years, we will submit thousands of pages to the [Nuclear Regulatory Commission] demonstrating the safety and technical feasibility of extending Surry’s operating licenses,” said David A. Christian, CEO of Dominion’s generation group. “We are excited to be the first utility in the U.S. to begin this process.”
Dominion timed the announcement to coincide with a White House symposium on the future of nuclear energy, during which the Obama administration underlined the importance of nuclear power in the nation’s energy future. “As America leads the global transition to a low-carbon economy,” states a White House fact sheet arising from that event, “the continued development of new and advanced nuclear technologies along with support for currently operating nuclear power plants is an important component of our clean energy strategy.”
The contribution of nuclear power is all the more critical for Virginia, which relies upon Dominion’s four nuclear plants at Surry and North Anna 3 for about 35% of the state’s electric power output. As Dominion scales back its coal-generated capacity in order to meet a Clean Power Plan mandate to cut CO2 emissions 32% by 2030, the company will be all the more dependent upon its zero-emission nuclear plants to meet demand.
Obtaining approvals from the federal Nuclear Regulatory Commission is just one hurdle. Virginia environmental groups oppose not only building a third nuclear unit at North Anna, at a mind-boggling cost of $19 billion, but extending the life of existing nuclear units at much lower cost. Glen Besa, executive director of the Virginia Chapter of the Sierra Club, likens the aging Surry units to an old car. “The older the car is, the more unreliable it is.”
The pros and cons of the two nuclear options — building a new plant and extending the old ones — shake out very differently.
Dominion wants to spend more than $800 million over the next six years on pre-construction design, engineering and permitting work for the North Anna 3 nuclear unit just to keep open the option of building it later, and that’s on top of hundreds of millions of dollars spent and passed on to rate payers already. Dominion’s logic is that (a) nuclear has zero carbon emissions, (b) nuclear will be less affected by fluctuations in the price of its fuel source than natural gas, and (c) the company has gotten really good at running nuclear power plants efficiently.
In the current economic environment, however, it’s hard to imagine the State Corporation Commission approving a $19 billion project when the cost of clean wind and solar power is steadily declining and the option always exists to purchase electricity on wholesale energy markets. Environmentalists also will make an issue of North Anna’s location on a fault line and the expense of disposing of nuclear waste.
The Surry project poses very different considerations. First, the capital cost of rehabbing the power plant to operate another 20 years will be modest — in the realm of $1.5 billion or so, roughly the cost of building a major gas-generated plant. Second, Surry’s operating costs are among the lowest in the nation.
In a ranking by Nucleonics Week earlier this year, Dominion’s Surry nuclear stations were the second lowest cost producers of 27 companies that reported their costs to the federal government between 2010 and 2012 — bested only by the company’s North Anna units.
“Safety, operational excellence and low costs are goals we strive for every day,” David Heacock, chief nuclear officer, told Nucleonics Week. “Key to our low-cost performance is our highly skilled and experienced work force in addition to having identical units. It is gratifying to see that we have been very successful when compared to other operating nuclear units.”
“We have a huge advantage in being able to share spare parts, and share workforce and procedures,” Heacock said. The company also gains a cost advantage over other nuclear operators by performing more work in-house.
Besa with the Sierra Club said that nuclear power plants experience wear and tear after decades of operation. Radioactive bombardment can cause the steel and concrete in the pressurized containment vessel to become brittle and less able to withstand the pressure, increasing the odds of a radioactive incident. “The analogy with an old car is a good example,” he said. “All sort of things start to happen when you have an old car. When a car breaks down, it’s just an inconvenience. When a nuclear plant has an accident, it can be catastrophic.”
Dominion responds that the company has a decades-long record of operating nuclear power plants safely and efficiently, and that nuclear provides much-needed diversity to its power portfolio as the company phases out most of its coal-fired units. Too much dependence upon natural gas exposes rate payers to fluctuating gas prices. Gas is cheap right now, but if history is any guide, it could easily double or triple in price in the future. Too much dependence upon wind and solar creates problems as well. The electric transmission grid can handle fluctuations in wind and solar output up to about 35% of total generating capacity. Any percentage higher than that can create interruptions to the power supply.
Extending the life of the Surry nuclear station will provide that fuel diversity at modest cost for years to come, Dominion says.