Legislative panel says nuclear power proposal's costs needs more study

Sep 20

McClatchy-Tribune Regional News - Judy Fahys The Salt Lake Tribune

Lawmakers on Wednesday slowed the rush toward Utah's first nuclear power plant.

The Interim Public Utilities and Technology Committee backed off a proposal to cut the financial risks faced by a utility company building a nuclear reactor. Instead, committee members want to study the costs ratepayers might have to bear if a proposal went forward and how those costs might compare to development of other energy sources.

"I would like to see some comparisons on a chart in front of me," said Rep. Janice M. Fisher, a West Valley Democrat and one of the panel members who voice general support for nuclear power.

After its July meeting, the panel requested legislation modeled on Florida's that provides incentives for new plants. At Wednesday's meeting, committee members heard two energy industry experts say that no new nuclear plants have been built for more than two decades; not because of environmental problems but because reactors are financially risky.

"It was basically, Wall Street, said, 'Hell, no, we won't give our money'," said David Schlissel, of Synapse Energy Economics, a Massachusetts-based consulting firm.

He offered some devastating statistics to back up this view. One was a U.S. Department of Energy review that showed that 75 of the nation's 103 nuclear plants were estimated to cost $45 billion in 1990 dollars but actually ended up costing more than three times as much -- $145 billion in 1990 dollars -- not including interest.

He said that, while the nuclear industry currently projects it can build plants for about $1,200 to $2,000 per kilowatt, those estimates are very likely optimistic, considering construction costs are rising and new designs have not been proven at full scale.

S. David Freeman, president of a hydrogen car company, offered a similar assessment, based on a 50-year career in the utility industry. He told about his time running the Tennessee Valley Authority's nuclear program, where 8 of 11 plants were canceled after cost overruns drove up electric rates and the utilities decided the costs were too high.

"Nuclear power cannot be advertised as something that's cheap," he said. "If somebody's trying to tell you that, then they are trying to sell you a bill of goods."

Both Freeman and Schlissel said concerns about disposing of nuclear waste and avoiding terrorism continue to be concerns about the expansion of nuclear power.

Members of the committee said they had another harsh reality to address: how to secure enough energy for a state when coal -- which provides nearly all of Utah's electricity now -- has mounting environmental costs and demand is expected to grow by about 3 percent a year.

The lawmakers declined to act on a Utah version of the Florida legislation.

"I think we require more study," said Sen. Scott Jenkins, a Plain City Republican and co-chairman of the panel. Although he said the committee had devoted most of its past few meetings to the subject, he agreed to still more discussion next month.