Washington (Platts)--22Apr2009

In remarks focused on the promise of renewable energy and demand-side
management, US Federal Energy Regulatory Commission Chairman Jon Wellinghoff
on Wednesday suggested that there may never be another new nuclear or coal
power plant built in the country.

Pointing to upwards of 1,000 GW of potential wind energy in the Midwest
and West, new solar power production and storage technologies and emerging
hydrokinetic power resources, Wellinghoff asserted that renewables are poised
to play a substantial, gap-filling role in the US energy picture.

That, coupled with strong natural gas reserves and load-response leveling
systems, could simply price coal and nuclear out of the energy market equation
for the foreseeable future, the chairman said at a Washington press briefing
sponsored by the United States Energy Association.

Asked about challenges facing construction of new nuclear and coal power
plants, Wellinghoff allowed that "we may not need any, ever." That's a
"theoretical question" because "I don't see anybody building these things
until costs get to a reasonable level."

He characterized the projected costs of new nuclear plants as
prohibitive, citing estimates of roughly $7,000/kW.

Price tags for new coal plants are similarly daunting, he said. Coal
plants also are being pressed by natural gas, which is coming on strong as a
competitor for power production, the chairman said.

"Natural gas is going to be there for a while," he said, noting that
production companies in recent years have discovered that "we have twice as
much" gas in the US "than we previously thought." That, in combination with
other factors, figures to keep natural gas relatively inexpensive "for a
while," competing "on the margin with coal" for new generation load.
--Chris Newkumet, chris_newkumet@platts.com