Should Dominion Virginia Power Spin Off its Nukes?

Over the past two years, Dominion Virginia Power has experienced 14 unplanned shutdowns of its four nuclear reactors, by the Times-Dispatch’s counting. Is it time for the power company to consider spinning off its nukes or selling them to someone who can do a better job of running them?

I ask that question after encountering a new study by Lucas W. Davis and Catherine Wolfram, “Deregulation, Consolidation and Efficiency: Evidence from U.S. Nuclear Power,” published by the National Bureau of Economic Research. Here’s the argument they make:

For four decades all nuclear power reactors in the United States were owned by regulated utilities. Few utilities owned more than one or two reactors and utilities received a rate of return on their capital investments that was largely disconnected from operating efficiency. Beginning in the late 1990s electricity markets in many states were deregulated and 48 of the nation’s 103 nuclear power reactors were sold to independent power producers selling power in competitive wholesale markets. These divestitures have led to substantial market consolidation and today the three largest companies control more than one‐third of all U.S. nuclear capacity.

… We find that deregulation and consolidation are associated with a 10 percent increase in operating efficiency, achieved primarily by reducing the frequency and duration of reactor outages. Efficiency gains were experienced broadly across reactors of different types, manufacturers, and vintages, with the largest increases in the spring and fall during the peak months for refueling.

The resulting increase in electricity production exceeds 40 billion kilowatt hours annually, valued at $2.5 billion annually at current prices. “This increase is almost pure efficiency gain, achieved without building a single new plant or constructing a single additional mile of transmission capacity,” the authors note. The increased electricity output, they add, displaces mostly coal‐ and natural‐gas‐ fired power, implying an annual decrease of 38 million metric tons of carbon dioxide emissions.

I was always under the impression that Dominion ran its nukes pretty well, so that 10% efficiency gain may not apply here. But we won’t know for sure if we don’t ask. Such a gain, if possible, would delay the need to add more power-generating capacity, thus keeping a lid on electric rates. Lower CO2 emissions are a bonus that environmentalists should love. Perhaps the State Corporation Commission should look into it.


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5 responses to “Should Dominion Virginia Power Spin Off its Nukes?”

  1. the only problem with their logic is that Nuke Power is not possible without govt subsidies in the form of liability caps for the investors.

    No insurance company on earth will sell open-market insurance to private investors for Nukes…for a price that allows them to be competitive on the “free market”.

    so the real question here – ought to be – what should the role of govt be

  2. I’d be a lot more open to Nukes if we built the kind that could not melt down.

    I’d even support govt subsidies for the safer versions of Nukes … but govt subsidies for private investors for Nukes that can do what the ones in Japan did.. is lunacy….

    in a country where the right wing routinely decries govt regulation and “involvement” in the private sector – they have no shame when it comes to nukes and ethanol… do they?

  3. Groveton Avatar

    “in a country where the right wing routinely decries govt regulation and “involvement” in the private sector – they have no shame when it comes to nukes and ethanol… do they?”.

    LarryG’s arguments are indicitive of a brainwashed shill for the leftmost wing of the Democratic Party. Those arguments are the braying of sheep among sheeple.

    I write those things with only love in my heart. Kind of like the way I feel for a dog that just isn’t getting that housebroken thing despite being old enough to know better.

    LarryG – anti-partisanship is the watchword of the hour. Is there any Republican (besides Ron Paul) who you respect? Is there any generally conservative position which you would adopt?

    Before you rant and rage …

    I like Terry McAuliffe
    I like Chap Petersen
    I thought Bill Clinton did a pretty good job (give or take a few things).
    I am anti-death penalty
    I believe that gay couples have the right to marry

    OK, LarryG – your turn. Where are your non – Democrat / Liberal positions?

    Remember – Anti-Partisanship is a good thing.

  4. geeze Groveton – what about the Nuke Liability issue? do you support Nuke and ethanol subsidies?

    I like all the guys you name to further include Romney and the essence of Ron Pauls principles (with caveats)… but I have no love for much of the Republican party these days.

    I’m not sure what you do with stone cold killers convicted with DNA evidence but some of their crimes are so sickening that I don’t get real upset when they get the needle though I’m opposed to torture.

    I think Medicare should cost much more than it does.

    I think the dialogue about SS is basically propaganda … the facts clearly show.

    I like toll roads and local taxation for local roads and I think people who live in subdivisions should be responsible for roads in their subdivision and I think subdivisions should be required to have two connections with roundabouts on the main drag to discourage cut-through traffic.

    I think VDOT should treat all roads of state-wide significance ( the Primary Roads with one and two digit numbers) as valuable for connecting the state and use heavy duty access management principles in protecting them.

    I think the higher Ed subsidized loans should go away save for critical job needs.

    I think K-12 sucks because we think that it’s okay to leave the kids without good parents behind… so we’ll spend 10K on things like sports and photo journalism but not on elementary core academics for at risk kids.

    I think we are total idiots for our neo-con, nation-building idiocies….especially when our own infrastructure is falling down.

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